A panel of Accredited Land Consultants of the REALTORS® Land Institute (RLI) shed light on the impacts of the Coronavirus (COVID-19) outbreak on land values and land market trends across the country in a recent Virtual Round Table session. The panel, which consisted of expert land agents from across the country, mostly pointed towards a positive outlook for the land market despite volatility in other areas. One key market they covered was farmland real estate.
RLI 2020 National President Kyle Hansen, ALC, with Hertz Real Estate Services in Nevada, IA, shared his expertise on what’s happening for agricultural tillable farmland, especially as for the Midwest. Kyle’s company holds a lot of in-person auctions and due to the stay at home orders and CDC recommendations they’ve been postponing a lot of those. However, he noted some are choosing to move to online auctions. “There’s been a little bit of activity, though some sellers are withdrawing their properties." He went on to say that "We haven’t seen much of a drop-off in the number of sales that we've seen happening. It is still a little too early to tell how much this is going to affect the market, but I can definitely tell you that there’s been a lot of activity; a lot of phone calls asking what’s available on the market.” He told listeners that most are looking for good deals and mixed-use agricultural/recreational properties.
On a positive note, he said “It seems like there’s money to be spent. I’ve even had a few properties that have been on the market for ten months to almost a year that I received three offers on in two-days and that hadn’t had almost any offers on over the past ten months. So there is definitely activity and some increased interest from buyers.” He believes that, especially for high-quality productive agricultural properties, they will continue not to see a drop off in buyers which is good news for sellers and the market as a whole.
The biggest change he’s seen since the shutdown? “We’ve been doing a lot of remote teleconferences… a face-to-face meeting isn’t necessarily warranted.” He went on to touch on other technologies that have enabled transactions to continue taking place remotely, saying “We’ve been using drones and are able to see a lot more with drone footage than ever before in the past… so it’s a tool that’s come out in the past few years that [agents] are really taking advantage of now.”
When asked by sellers if now is the right time to list, Kyle tells them “It’s the right time when you and your family decide to sell a farm.” As he pointed out, "no one can know for sure what is going to happen to the market six months from now," so he believes “as long as [sellers] are realistic and understand the market conditions right now, I tell them that we’ve got buyers asking.” Predicting some pent-up demand after all this gets figured out and the market goes back up, he says “You have to be positioning now to get your property on the market.”
Kyle also pointed out that for those looking to do a 1031 Exchange or who are getting close to the deadline of finalizing one, they have extended the deadline to July 15. This 1031 deadline extension was fought for by the REALTORS® Land Institute which signed on to a letter from the National Association of REALTORS® petitioning congress for an extension. NAR and RLI have advocated heavily for these extensions since the outbreak of the COVID-19 pandemic.
He said the best things buyers and sellers can do right now is “to try to understand the market and visit with your land professional each and every day.”
For more insights on the impacts of the outbreak and shutdown on the ranch land market for ranchers from Clayton as well as insights on how other land markets are being impacted, make sure to watch the full Impacts of COVID-19 on The Land Market Virtual Round Table presented by the RLI 2020 Future Leaders Committee or check out the related posts below:
If you are interested in buying, selling or investing in land real estate, make sure to Find A Land Consultant, like an ALC, in your area with the expertise needed to best assist with your transaction.
About: Kyle Hansen, ALC, has been a member of RLI since 2008, receiving his ALC Designation in 2011. In 2015 and 2016, he served as Chair of RLI National’s Future Leaders Committee. He is an active member of the RLI Iowa Chapter, serving as their President from 2012-2013. The chapter also awarded him the RLI Iowa Chapter Land Broker of the Year Award in 2013. Then in 2014, he received the RLI National Rising Star Leadership Award which recognizes a member approaching a mid-level in their career who is on their way to making significant contributions to the land profession and to RLI. Kyle later went on to receive a 2017 RLI Top Twenty Producer APEX Award and was among those recognized in the 2017, 2018, and 2019 APEX Producers Club as part of the RLI APEX Awards Program. Kyle received his Broker’s license in 2016 for Iowa and Missouri.