Iowa is the heartland of America, with rolling plains and fertile farmland spanning much of the state. Agriculture drives a large part of the state’s economy and culture, making land intrinsically valuable. For people in possession of acreage, the decision to sell can raise many considerations around timing, pricing and ease of sale. One method some consider is selling to a local land buyer. But what are the pros and cons of this option?
The average price of an acre of land in Iowa is $7,264. While this figure is rising, it remains less expensive than the national average of $142,600. The state’s economy is primarily driven by farming, with corn taking up a majority of the state’s land and livestock also having significant importance. A number of factors affect the overall agricultural climate in the state, including weather and a variety of pests that can threaten the profitability of fields.
Many of the world’s leading food producers and agribusinesses are located in Iowa. It is the country’s top producer of corn, second in soybeans and leads the nation in hog and egg production. In addition to the traditional agricultural acreage, Iowa is home to a variety of other real estate opportunities such as recreational property and hunting land.
Some of the state’s biggest employers are in manufacturing and processing, such as the Quaker Oats plant in Cedar Rapids, a GM facility in Sioux City and a massive wheel-tractor plant in Waterloo. This industrial growth has also resulted in the construction of many new homes, and a growing population means that the demand for housing will continue to increase.
Public auctions have long been the chief mode of sales for Iowa’s land, though private party and facilitated real estate deals are also common. Many of these transactions are carried out by investment firms, such as those linked to the Bill and Melinda Gates Foundation.
For those looking to sell land, a good place to start is understanding the market and performing some due diligence to identify the best value for your property. You can do this by analyzing similar land sales in your area and getting an idea of the going rate for your specific acreage. In addition, improving the appearance of your property through clearing and landscaping can have a positive impact on its appeal to potential buyers. Finally, some Iowa land buyers may offer lease-back provisions allowing sellers to still utilize their land for a fixed period post-sale, prior to the buyer taking full possession. This option can provide additional liquidity to those needing immediate liquidity but who don’t want to stop using their acreage for agricultural purposes. These lease-back agreements typically last 1-5 years.