Illinois farmland values continue to go up, increasing 92% since 2000, said Dale Lattz, University of Illinois Extension farm management specialist.
"The average farm real estate value for Illinois in 2007 was $4,330/acre, the highest on record," says Lattz. "This includes the value of all land and buildings. The figure was 13.9% higher than the 2006 average of $3,800/acre.
"The current strength in farmland values seems to be driven by higher corn and soybean prices and the expectation that these prices will remain high due to strong demand."
Lattz discussed the increase in his report, "Illinois Farm Real Estate Values Continue Double-Digit Increases," which is available on Extension's farmdoc Web site.
"The 2007 increase, based on figures from the USDA's National Agricultural Statistics Service, marked the third year in a row of double-digit increases," he noted. "The 2005 value increased 27.6%, and the 2006 value increased 14.1%.
"The 2007 percent increase was the third highest since 1979. Farm real estate values have shown a year-over-year increase every year since 1988, or 20 consecutive years."
Since 1970, average farm real estate values have declined only five times as compared to the previous years. Those years were 1982, 1983, 1985 and 1987.
"There have been four years when farm real estate values increased over 20%, in 1974, 1976, 1977 and 2005," Lattz said. "The largest increase came in 1977 when values rose 37.3%."
From 1994 through 1999, average farm real estate values increased between 4.2 and 9% annually. From 2000 to 2004, farm real estate increased between 1.3 and 7.4%."Since 2004, the increase in farmland values has averaged 18.5%," he said.