In 2024, U.S. agricultural land values increased by $200 per acre, reaching an average of $4,170 per acre, according to the U.S. Department of Agriculture’s National Agricultural Statistics Service.
This represents a 5 percent increase over 2023 and marks the fourth consecutive annual rise in land values, though the rate of increase has slowed compared to previous years. The report highlights broader trends in the agricultural sector, with farmers facing higher land and rental costs amid fluctuating commodity prices and rising input expenses.
Farm real estate value
The U.S. average farm real estate value, which includes all land and buildings on farms, reached a record high in 2024. However, this 5 percent increase is less than the 6.7 percent rise observed between 2022 and 2023 and significantly lower than the 11.7 percent spike between 2021 and 2022, which was the largest year-over-year increase since 2006. The $200 per acre increase in 2024 matches the rise seen between 2020 and 2021, though it falls short of the $250 per acre increase recorded in 2023 and the $390 per acre surge in 2022.
Despite the ongoing increase in land values, the slower rate of growth poses challenges for farmers who rely on the equity in their land to finance operations and investments. Slower growth in land values means slower growth in equity, which reduces farmers’ ability to leverage their assets for additional capital. This could particularly affect farmers’ ability to purchase essential inputs like seeds and fertilizer.
As American Farm Bureau Federation economist Daniel Munch notes, the deceleration in land value growth could lead lenders to perceive higher risks in lending to farmers, especially if land values are expected to plateau or decrease.
Regional variations and influencing factors
Agricultural land values vary significantly across the country, with the highest real estate values found in areas producing high-value crops, such as wine grapes and tree nuts in California. Additionally, areas near urban centers with limited developable land, particularly in the Northeast, experience upward pressure on real estate values due to competing uses. The Midwest generally has higher comparative agricultural land values, followed by the South and Pacific Northwest, while the Plains and Mountain states see the lowest values.
Cropland values, which are often tied to the long-term profitability of farming the land, have also risen, although the rate of increase has cooled in line with receding commodity prices. In 2024, the average U.S. cropland value increased by 4.7 percent to $5,570 per acre. This is a smaller increase compared to the 8.1 percent jump between 2022 and 2023 and the 7.8 percent rise in 2021. States like Tennessee, Ohio, Florida, and Kentucky saw some of the highest percentage gains in cropland values, while states like Wyoming, Montana, and New Jersey experienced slight declines.
Pastureland values have also increased, averaging $1,830 per acre in 2024, which represents a 5.2 percent increase over the previous year. This rise follows several years of little-to-no growth in pastureland values.
Unlike cropland and overall real estate values, pastureland values are highest in East Coast states and the mid-South, areas that face higher competition for open land due to development pressures.
Cash rent increases
The increases in land values have also translated into higher cash rents. In 2024, average U.S. cropland rent increased by 3.2 percent to $160 per acre, with irrigated cropland rents rising by 3.4 percent to $245 per acre, and non-irrigated cropland rents increasing by 2.8 percent to $146 per acre. Pastureland rents also saw a 3.3 percent rise, reaching $15.50 per acre.
The highest increases in cropland cash rental rates were in Hawaii and Oklahoma, which saw 11 and 10 percent rises, respectively.
However, these rising costs pose significant challenges for farmers, especially those who rely on rented land. Higher rental rates, coupled with already high input costs, threaten the financial viability of many farmers.
Those who lack equity from land ownership may find it more difficult to secure operating lines of credit necessary for annual equipment and input purchases.
While rising land values and rents benefit landowners by enhancing equity and rental returns, they place additional financial strain on farmers, particularly new or beginning farmers and those dependent on rented land. The agricultural sector faces significant challenges in maintaining stability and productivity under these conditions.