Invest in Farmland
http://profitableinvestingtips.com/investing-tips/invest-in-farmland Invest in Farmland A commonly held belief is that land is a good investment because it always retains its value. If you invest in gold you have a hedge against inflation but if you invest in farmland you have a hedge against inflation and profits from the crops produced there. The Wall Street Journal writes about Farmland Investments. Farmland is attracting growing interest from pension plans, hedge funds and even mom-and-pop investors as they seek to diversify assets and capitalize on an agriculture-industry slump that has pushed down land prices in some regions. Financial-services giant TIAA-CREF announced Tuesday that it has raised $3 billion for its second global farmland-investment partnership, exceeding its initial target of $2.5 billion. The fund, which will invest in North and South America and Australia, has lined up commitments from institutional investors, including the New Mexico State Investment Council and the U.K.’s Greater Manchester Pension Fund. Investors are betting farmland will yield good long-term returns as global food demand rises with growing populations and wealth in Asia, Africa and elsewhere. The amount of arable land is expected to increase only modestly, at best, due to urbanization and a lack of acreage suitable for crops. The tag line for this sort of investment is gold with a coupon. A farmer can invest in farmland, live of the property and grow crops or raise livestock. An outside investor who chooses to invest in farmland is betting that the price of land will go up and that there will be a healthy cash flow from the property. How realistic are these expectations? The Price of Farmland What are prices like in the American Corn Belt and where are they likely to go? AG WEB provides insight into Iowa farmland values. The scales have tipped for Iowa farmland values. After several years of dramatic increases, this year marks a drop in value. For 2014, the average value of an acre of Iowa farmland is $7,943-a drop in value of $773, or nearly 9%, per acre from 2013. “This the sharpest decline since 1986,” says Mike Walsten, editor of LandOwner newsletter. But, Walsten says, you should keep these numbers in perspective. “The value of Iowa farmland is still double what it was 10 years ago,” he says. The chart from AG WEB shows the average price per acre of Iowa farmland since 1950. The rise in prices since 2000 is reminiscent of the rise of gold. The difference is that the correction has occurred later than with gold. Will farmland follow gold to lower prices? Factors Driving Historic Farmland Prices Midwestern (Corn Belt) farmland experienced two value peaks in the twentieth century. One was in the period before and immediately after World War I and the other was during the inflationary surge of the 1970’s.
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Invest in Farmland
- 1. Invest in Farmland By www.ProfitableInvestingTips.com
- 2. http://profitableinvestingtips.com/investing-tips/invest-in-farmland A commonly held belief is that land is a good investment because it always retains its value.
- 3. http://profitableinvestingtips.com/investing-tips/invest-in-farmland If you invest in gold you have a hedge against inflation but if you invest in farmland you have a hedge against inflation and profits from the crops produced there.
- 4. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Before We Continue… Click the links below to get your FREE training materials. Free Weekly Investing Webinars Don’t miss these free training events! http://www.profitableinvestingtips.com/free-webinar Forex Conspiracy Report Read every word of this report! http://www.forexconspiracyreport.com Get 12 Free Japanese Candlestick Videos Includes training for all 12 major candlestick signals. http://www.candlestickforums.com
- 5. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The Wall Street Journal writes about Farmland Investments.
- 6. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Farmland is attracting growing interest from pension plans, hedge funds and even mom-and-pop investors as they seek to diversify assets and capitalize on an agriculture-industry slump that has pushed down land prices in some regions.
- 7. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Financial-services giant TIAA-CREF announced Tuesday that it has raised $3 billion for its second global farmland-investment partnership, exceeding its initial target of $2.5 billion.
- 8. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The fund, which will invest in North and South America and Australia, has lined up commitments from institutional investors, including the New Mexico State Investment Council and the U.K.’s Greater Manchester Pension Fund.
- 9. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Investors are betting farmland will yield good long-term returns as global food demand rises with growing populations and wealth in Asia, Africa and elsewhere.
- 10. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The amount of arable land is expected to increase only modestly, at best, due to urbanization and a lack of acreage suitable for crops.
- 11. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The tag line for this sort of investment is gold with a coupon.
- 12. http://profitableinvestingtips.com/investing-tips/invest-in-farmland A farmer can invest in farmland, live of the property and grow crops or raise livestock.
- 13. http://profitableinvestingtips.com/investing-tips/invest-in-farmland An outside investor who chooses to invest in farmland is betting that the price of land will go up and that there will be a healthy cash flow from the property. How realistic are these expectations?
- 14. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The Price of Farmland
- 15. http://profitableinvestingtips.com/investing-tips/invest-in-farmland What are prices like in the American Corn Belt and where are they likely to go?
- 16. http://profitableinvestingtips.com/investing-tips/invest-in-farmland AG WEB provides insight into Iowa farmland values.
- 17. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The scales have tipped for Iowa farmland values.
- 18. http://profitableinvestingtips.com/investing-tips/invest-in-farmland After several years of dramatic increases, this year marks a drop in value.
- 19. http://profitableinvestingtips.com/investing-tips/invest-in-farmland For 2014, the average value of an acre of Iowa farmland is $7,943-a drop in value of $773, or nearly 9%, per acre from 2013.
- 20. http://profitableinvestingtips.com/investing-tips/invest-in-farmland “This the sharpest decline since 1986,” says Mike Walsten, editor of LandOwner newsletter.
- 21. http://profitableinvestingtips.com/investing-tips/invest-in-farmland But, Walsten says, you should keep these numbers in perspective.
- 22. http://profitableinvestingtips.com/investing-tips/invest-in-farmland “The value of Iowa farmland is still double what it was 10 years ago,” he says.
- 23. http://profitableinvestingtips.com/investing-tips/invest-in-farmland
- 24. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The chart from AG WEB shows the average price per acre of Iowa farmland since 1950.
- 25. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The rise in prices since 2000 is reminiscent of the rise of gold.
- 26. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The difference is that the correction has occurred later than with gold.
- 27. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Will farmland follow gold to lower prices?
- 28. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Factors Driving Historic Farmland Prices
- 29. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Midwestern (Corn Belt) farmland experienced two value peaks in the twentieth century.
- 30. http://profitableinvestingtips.com/investing-tips/invest-in-farmland One was in the period before and immediately after World War I and the other was during the inflationary surge of the 1970’s.
- 31. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Before you go and invest in farmland at this point on the price curve read the late 1970’s article about factors affecting agricultural land prices.
- 32. http://profitableinvestingtips.com/investing-tips/invest-in-farmland In the twenty years that preceded 1920 there was a 245% increase in the value of farmland (including improvements) before land values fell sharply.
- 33. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Today’s [as of 1977] escalation in land values – 364 percent between 1957 and 1977 – prompts some pointed questions.
- 34. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Have land values reached their peak? If not, when will they plateau if ever?
- 35. http://profitableinvestingtips.com/investing-tips/invest-in-farmland Will they decline and, if so, will the descent to sudden or gradual?
- 36. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The answer to the 1977 era descent question is that values in the 1980’s fell rather rapidly as interest rates rose, inflation came under control and the stock market went into an extended climb.
- 37. http://profitableinvestingtips.com/investing-tips/invest-in-farmland The writer notes that while productivity should be what drives farmland prices (coupled with demand) the perception of land scarcity is a big driver of farmland prices.
- 38. http://profitableinvestingtips.com/investing-tips/invest-in-farmland If you want to invest in farmland you should ask yourself if interest rates will go up and if the current farmland price curve is going to follow the examples of the twentieth century and drive farther before flattening out.