Missouri Real Estate Trends

Missouri’s agriculture is diverse because of the diversity of our farmland. When you go from Northern to Southern Missouri, you will see a difference in the commodities produced and the prices and values of the real estate.

Annually, our Appraisal Department reviews trends in real estate values from the last year. This report runs from July 1 – June 30. Below is a summary of the report.

Supply & Demand

In Northern Missouri, the supply of cropland for sale has increased and the demand is strong. Fall 2012 and spring 2013 saw higher prices for cropland and significantly higher prices in good crop areas. The pasture supply in this area has decreased due to higher corn and soybean prices, higher feed prices, and some pasture, hay, or CRP converted to cropland.

Southern Missouri has a smaller percentage of cropland. The demand is slightly stronger than the supply of cropland available for sale. The supply of pastureland is fairly stable but demand is slighter weaker than supply. Most of the pastureland is this area is used for cattle production. The cattle prices have remained strong but the cost of production rose significantly during the last year.

Northern Missouri continues to see non-local buyers purchasing marginal pasture and woods for hunting and recreational use, while Southern Missouri shows a weakened demand for recreational land. Neither area is seeing a demand for development land within a driving distance to a major employment center.

Agricultural Economies

Corn, soybeans, cattle, hogs and winter wheat are the primary commodities in Northern Missouri. Southern Missouri commodities consist of cattle, poultry (broilers & turkeys), dairy, wheat, corn and soybeans. Many of the dairy producers in the southern Missouri are moving to producing heifers for the western dairies rather than producing milk.

Value Changes

Northern Missouri is seeing substantial changes in real estate values because of high commodity prices, historically low interest rates, higher farm income, and crop insurance protection. For example, upland crop production that is yielding 120-160 bushels of corn per acre has seen a 20-30% value increase over the last year. Southern Missouri has seen much smaller change in cropland, cattle, hay or timberland values. The chart below illustrates these changes in value.

Average Missouri Farmland Values
(FCS Financial Benchmarks, 37 years)

Cash rent prices have increased across the entire state. Northern Missouri is seeing a 5-10% increase in the cash rent for medium quality cropland. This cropland typically yields 120-160 bushels of corn per acre. The rent per acre ranges from about $130-$200. Southern Missouri saw an increase but not as substantial. The largest increase in Southern Missouri is 8% for cropland that can produce 35-40 bushels of soybeans per acre. Below are two charts that provide more details about the cash rent prices.

Northern Missouri

Property Type	Primary Commodity	Quality PI/Yield/Size	Cash Rental Rates/Unit	% Change From Prior Period +/-
Cropland A	Corn	160 - 220 Bu.	$170 - 250	20% - 35%
Cropland B	Corn	120 - 160 Bu.	$130 - 200	15% - 30%
Pasture A	Cattle/Hay	3 - 4 T.	$45 - 65	0%- 5%
Pasture B	Cattle	1 - 2 T.	$30 - 45	0% - 5%
Pasture C	Cattle	1 T.	$20 - 35	0% - 5%

 

Southern Missouri

Property Type	Primary Commodity	Quality PI/Yield/Size	Cash Rental Rates/Unit	% Change From Prior Period +/-
Cropland A	Soybeans	35 - 40 Bu.	$50 - 65	8%
Cropland B	Soybeans	25 - 30 Bu.	$45 - 60	2%
Pasture A	Hay/Pasture	3 - 4 T.	$25 - 40	1.5%
Pasture B	Cattle	1 - 2 T.	$20 - 22	0%
Pasture C	Cattle	1 T.	$10 - 20	0%

The charts above show pasture cash rent increases are much smaller. In Southern Missouri, pasture and hay ground saw an increase of 1.5%, pasture for cattle remained unchanged from a year ago at $10-$22 per acre. Northern Missouri pasture or hay land saw anywhere from no change to a 5% increase. The prices ranged from $20-$65 per acre.

Again, these are just trends seen by our appraisers within the last year. There are significant differences between regions in the state and even from one county to the next. Like everything, these values will change but this gives you a general view of Missouri’s agricultural real estate value trends over the last year.