After seven years of waiting for an opportunity to make his first land purchase, Jordan Vittetoe, 29, finally secured the farm that ticked all of his boxes, but it required a premium price. (Vittetoe is pictured with wife Rebecca and their two children, Grant, 3, and Madison, 1.)
"An upcoming generational shift is changing the scope of land sales," says Alex Gyllstrom, marketing director of Whitetail Properties. "Roughly 60% to 70% of privately owned land is expected to change hands in the next 20 years. Current landowners are starting to phase out of ownership, whether the reason is retirement, consolidation of their portfolio, to liquidate assets, or to diversify."
The next generation of buyers, those just like Vittetoe, will have opportunities that buyers in the past few decades haven't seen.
But purchasing land isn't without its challenges. Vittetoe had struck out multiple times trying to secure quality farmland at public auction in Washington County, Iowa, a highly competitive market.
Finally, in March, Vittetoe landed at auction a 73-acre corn and soybean farm that had been operated by a long-term renter and had been owned by a single family, the Atkinsons, since 1889.
The farm is just several miles from Vittetoe's family farm. That means he has access to a modern line of equipment, which is typically out of reach for first-time farmers because of the overhead cost.
Vittetoe looks forward to building on the century farm's historic past for his own future in farming.
Vittetoe's advice to future first-time landowners is to save money and be patient.
Before buying his own farm, Vittetoe worked for a local ag retailer and he also custom-fed hogs for a family swine operation.
"I also recommend using your local, state, and federal resources to help you be more competitive," Vittetoe says. "There are programs that a young farmer can take advantage of that someone who is established might not have access to," he says.
Gyllstrom adds that for any buyer, establishing a clear set of goals is key. That may include the financial limitations, income potential of the land, and ways the property will be used in the future.
"This is my first step into row crop farming," Vittetoe says. "It's exciting for me to own land because it is a finite resource that has long-term intrinsic value. I want to take care of this farm and ensure the ground will last for generations."
Past and Present on the Farm
Preservation of the family farm is what the former landowners, Jerry Atkinson and his two sisters, wanted. That the farm sold to a first-time farmer who is local to the community, not an outside investor, was the cherry on top.
The Atkinson family no longer lives in Iowa, and between the siblings, they have many children, grandchildren, and great-grandchildren.
"My sisters and I had several discussions over the past five years about the future of the farm and the difficulties in passing on the land," Atkinson says.
Ultimately, they decided it was best to sell, and they partnered with Whitetail Properties to handle the process.
For three reasons, this was an atypical sale.
First, the Atkinson siblings never met Ben Harshyne, the Whitetail Properties land specialist who worked with the family. They all communicated remotely but still established a trusting relationship.
Second, a farm like the Atkinsons' would typically be sold through a traditional listing, but Harshyne knew it would work in the family's favor to sell at auction.
Third, this was Harshyne's first auction with Ranch & Farm Auctions, a division of Whitetail Properties.
"Historically, tillable land is a strong sell at auction," Harshyne says. We could attract the most local competition and therefore get the highest sale at an auction."
In the end, the sale was a grand slam, selling at $3,000 more per acre than any of them anticipated. Harshyne calls it the most rewarding sale of his career, but not because of the dollar amount.
"It was my personal mission to make this auction a success," Harshyne says. "This was also the most stressful sale of my career because the Atkinsons trusted me with their legacy, with the land that generations of people had relied upon."
Land Auction Trends
Demand for income-producing land like the Atkinsons' and recreational land in rural areas is at an unprecedented level.
"There is a perfect storm of factors driving this demand: current economic trends, volatility in the stock market, and long-term appreciation," Gyllstrom, explains.
As a limited commodity, land investments are stable with positive returns, leading to premium prices per acre.
Gyllstrom says the pandemic caused a societal shift. People everywhere are turning to nature for an emotional reset, to spend time with loved ones in recreation, whether that is hunting, camping, hiking, or starting a hobby farm, he says.
"Rural land, whether it is recreational or income-producing farmland, will continue to be in high demand," Gyllstrom says. "For potential buyers out there, we're confident that financing will remain attractive for the foreseeable future. The future is bright for land real estate." *
Regenerative Ag in Washington County, Iowa
According to the 2017 USDA Census of Agriculture, the total acres in Washington County, Iowa, are 310,445. The county's farmers are known for their widespread adoption of soil health practices. With rich soil and prime row crop growing conditions, this is how they maintain the land:
No-till acres: 122,781
Acres in conservation tillage (excluding no-till): 74,233
Acres of cover crops planted: 30,819
Acres drained by tile: 157,154
Acres of land in conservation
easements: 5,571
Of all acres in the county, only 20,134 are conventionally tilled. *
Young and Beginning Producers
In 2017, beginning farmers accounted for 27% of producers in the United States. Their average age was 46.3 years and their farms were smaller than average in acres and sales.
A young and beginning farmer identifies as someone age 35 and younger. In Washington County, Iowa, this group operated 34,215 acres.
Of those acres, 16,861 were operated by a young and beginning farmer who is the principal producer. *
Factor in Data To Sell or Buy Land
Whether you're preparing land to sell or keeping a watchful eye on new opportunities to buy, data is key. Joe Gizdic, director of auction services at Whitetail Properties, says, "The more data there is, the better we can market the farm and present a good picture for a buyer."
Below are key factors that strengthen a sale when included in a listing:
Tile maps
Fertility records, including pH levels
Tenancy agreements
Participation in government programs
Bushels per acre
Recreational areas
Access points
Timber value
Wildlife
Gizdic also recommends ensuring the waterways are in good shape and any broken tile lines are fixed. *