11-13 IAT Land Values

Northwest Land Values: Markets Mostly Stable Amidst Slower Sales. Rural and agricultural real estate markets remain mostly stable for the majority of the Northwest region. However, sales transactions are very limited in 2013 with over half of these occurring during the first quarter of the year. Market observers in all four Northwest states - Idaho, Montana, Oregon, and Washington - continue to report a shortage of good quality agricultural properties on the market.

Here's Toni Parish

VP-Appraisal Services for NWFCS: " Limited availability is impacting real estate sales potential. Most sales transactions continue to occur between landlords and tenants. Activity in the rural residential property market increased in early 2013. Although this market has slowed in response to rising interest rates during the second and third quarters, value trends remain stable in many markets. Market activity in the recreational market segment remains low in many areas of the Northwest. Properties with premier recreational features, or those located in areas with limited private ownership continue to draw the greatest interest. Market activity has increased for larger acreage ranches in many areas of the Northwest. These properties have primarily been purchased by existing operators. For the past two years, all Northwest states showed increases in value for cropland (both irrigated and dry) and pasture lands, including agricultural properties with recreation and development influences. Looking ahead, potential buyers are becoming increasingly cautious about the direction of land values. "

Falling grain prices and rising interest rates have some national analysts predicting a correction in agricultural land values throughout the United States. Regionally, drought conditions remain a concern in areas of the Northwest. Irrigation water supply was sparse throughout the late summer in areas of Idaho, Montana, and Oregon with reservoir storage in many areas nearly or completely exhausted. The irrigation water supply for next year remains in question.

Northwest Farm Credit Services' Land Value Survey is based on real estate and sales activities that are monitored by Northwest FCS appraisers throughout Idaho, Montana, Oregon and Washington.