By Joel Salatin “Why are the rental rates of farmland versus its market value so disparate compared with any other rental-versus-ownership ratios?” one of our apprentices asked at supper last week.
I wish I had a nickel for each hour I’ve spent trying to explain that, unlike residential and commercial real estate, farmland rental rates will not pay the mortgage. Many people have become wealthy investing in commercial and residential real estate by having the rent pay the mortgage.
But that doesn’t happen in agriculture.
In our area, going rental rates for farmland run about 0.5% of the land’s value. In other words, farmland worth $7,000 …read more
