1. Oklahoma Land Value Update
Roger Sahs, Extension Specialist, Ag Econ.

2. OK Land Values by Region, 2011
West-Northwest
Tracts
Size
$/Acre $1226
% Chg +25.5
North Central
Tracts
Size
$/Acre $1403
% Chg
Northeast
Tracts
Size
$/Acre $1578
% Chg +2.8
East-Northeast
Tracts
Size
$/Acre $1816
% Chg +4.2
Panhandle
Tracts
Size
$/Acre $662
% Chg
Southeast
Tracts
Size
$/Acre $1468
% Chg
State Averages
Tracts
Size
$/Acre $1383
% Chg
Overall, values increased 7.3% since 2010 with cropland gains on a percentage basis exceeding pasture ground.  Regional  differences  for the year were rather substantial. 
Southwest
Tracts
Size
$/Acre $1040
% Chg
South Central
Tracts
Size
$/Acre $1588
% Chg
OK Land Values by Region, 2011

3. Recent Trends in Oklahoma Land Values
District
2011
One Year Change
3 Year Change
5 Year Change
$/ac
Percent Change
Panhandle
662
15.8
28.2
114.1
West-NW
1226
25.5
21.6
63.8
Southwest
1040
5.1
11.3
55.4
North Central
1403
14.3
13.5
25.3
South Central
1588
11.9
-2.7
17.9
Northeast
1578
2.8
6.6
24.2
East-NE
1816
4.2
-2.1
4.6
Southeast
1468
5.3
2.7
26.5
Cropland
1390
17.4
20.2
53.1
Pasture
1449
4.0
3.5
18.3
State
1383
7.3
8.2
26.1
Greatest appreciation in values has been in the western 1/3 of the state since markets characterized by spirited demand and a limited supply of parcels.
Regional variations are characterized by cropland/grazing land mix.
Source:

4. Oklahoma Cropland vs Pastureland Prices
In nominal $, there has been a full recovery of land values from years of devaluation.
Since 1981, land values have rebounded 104% from In real or inflation adjusted terms, values are still 17% below their peak. It was not until 2000 that the average nominal value per acre surpassed the early 1980's levels.
Tracts consisting of mostly cropland have not increased in value as much as tracts dominated by pasture until recently, but still lag 38% in real terms.
In real terms, pasture ground appreciation has kept up with the general rate of inflation.
Pasture values heavily weighted by the number of ac sales tracts in Eastern OK. ½ of all tracts in dataset are pasture, 15% cropland.
Source:

5. Survey of Tenth District Ag Credit Conditions
Strong demand for cropland and limited supplies of farms for sale continued to support this land market.
A strong cattle economy influenced pasture values despite continued drought conditions in states like OK. Historically low % rates and pockets filled with cash allowed producers to finance half of new purchases. These demand elements are expected to continue
Likely, the real truth in land value % gains is somewhere inbetween.
Source: KC Federal Reserve Bank, First Quarter, 2012

6. Tracts >= 40 Acres and <= $3000/Acre
Wheat belt dominant in early time period with average values between $500 and $700 per acre.
North Central had highest land values in state other than Oklahoma City and Tulsa areas.
Values generally less than $500 per acre for rest of state.
Average Value
Tracts >= 40 Acres and <= $3000/Acre
Source:

7. Tracts >= 40 Acres and <= $3000/Acre
Largest gains in eastern Oklahoma and around metro areas with all but 11 counties above $1000 per acre and 28 over $1500.
Over the past 35 years, western Oklahoma land value experienced modest gains especially where cropland is predominant.
Five fold variation in prices from west to east.
Average Value
Tracts >= 40 Acres and <= $3000/Acre
Source:

8. OK Counties with Largest Percentage Increase in Land Values
County
Average($)
Average($)
% Change
Love
356
1,957
450
Marshall
339
1,819
437
Johnston
308
1,612
423
Okfuskee
214
1,105
416
Pittsburg
272
1,380
407
LeFlore
274
1,389
Coal
273
1,372
402
Pushmataha
292
1,459
400
Adair
340
1,685
396
Delaware
382
1,878
392
What do these counties have in common?
Eastern OK east of I35.
Source:

9. OK Counties with Smallest Percentage Increase in Land Values
County
Average($)
Average($)
% Change
Alfalfa
800
1,193 49
Grant
590
1,004 70
Kingfisher
646
1,122 74
Texas
334
633 89
Garfield
628 90
Cimarron
210
402 92
Kay
601 99
Major
469
1,030
120
Noble
472
1,077
128
Cotton
384
887
131
What do these counties have in common?
Primarily cropland areas of western OK west of I35
Source:

10. Land prices going ahead…
Changes in the environment
Farm Bill
Domestic economy
Global economy
Elections/policy
Interest rates
Recreational uses
Wildlife habitat, wildlife population
Development uses
Population growth
Per capita income
Agriculture
Input prices
Cattle, wheat/feedgrain prices
Yields
Efficiency, productivity
Continued drought
Land is an income producing asset..so anything that impacts earnings impacts its value.
Big factors is anything that impacts farm income and interest rates
We do have strong balance sheets and liquidity going into drought
Before declines will occur, farmland return v or % ^.
Capital spending v
Loan repayment rates v
Liquidity v
Economic conditions remain uncertain and financial management will be as important as production performance. 

11. Source: KC Federal Reserve Bank, Second Quarter, 2012
However, falling interest rates have countered declines in cash rents relative to farmland prices. Falling interest rates
tend to support increases in all asset prices – including farmland prices – for two reasons. First, declining interest
rates make it easier to finance farmland purchases. As interest rates decrease, loan repayment amounts decrease,
thereby increasing the demand for farmland. Second, interest rates represent returns on alternative, fixed income
investments to farmland. As interest rates fall, the attractiveness of fixed income investments fall relative to farmland,
thereby providing support for farmland prices.
Source: KC Federal Reserve Bank, Second Quarter, 2012

12. Current commodity prices are a strong factor behind recent land value trends. We’ve seen strong earnings from high commodity prices.

13.
Updated for Thanks to Farm Credit Assoc for continued assistance with our efforts.

14. Resources Agecon.okstate.edu/oklandvalues
Kansas City Federal Reserve Bank
Choose RESEARCH & DATA, then Economic Review or Agricultural Credit Survey
USDA Ag Land Value Data and Reports