Each year the Farm Credit Illinois (FCI) appraisal team evaluates the same 20 benchmark farms throughout its 60-county territory based on the land’s productive index (PI) rating, as calculated by the University of Illinois’ Bulletin 811.
Value Trends in the Last Decade & Today
Land values in the central and southern 60 counties of Illinois declined for the third consecutive year following a dramatic run-up in values from 2003-2014.
The 2015 benchmark study showed the first overall decline in more than a decade with an average decrease of 1.51 percent. 2016 showed a more widespread decrease with an overall average decline of 6.34 percent and 16 of the 20 benchmarks declining in value.
Sustained lower commodity prices and net farm income are starting to have a greater impact on farmland values. While demand for Illinois farmland remains favorable due to a limited supply and still historically low interest rates, farmland values have further declined 4.17 percent from July 1, 2016, to June 30, 2017, in FCI’s territory. Thirteen benchmark farms decreased in value, five showed virtually no change, and two slightly increased. [Read more…]