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If you’re looking to buy farmland, you are making a solid choice. Farms are a tangible asset that aren't correlated with the ups and downs in the stock market or even the overall housing market.
They are an excellent option for earning income, whether that’s from renting out the farmland or from your share of the annual crop harvesting.
As with any other major purchase – including financial assets – you need to do your homework to determine whether or not it will add long-term value to your portfolio.
So, what’s the average price tag on one acre of farmland? According to the USDA, the average cost of farmland in the U.S. is $3,160 per acre. But remember, this is just an average.
Keep reading to learn more about what influences this cost.
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Factors That Influence Cost
Like all other real estate properties, one of the factors influencing the value is location.
One of the most important stages of farming is transporting the goods – whether it’s wheat, corn, citrus fruits or timber – to a port to be shipped out. Therefore, if the farm is out in the middle of nowhere, transportation costs are going to be higher.
You also want to look for farms that have a history of successful harvests and have the potential to expand. Clearly, you want to buy farmland in an environment that has the best natural resources to flourish, including soil quality, sunlight and available irrigation.
That is why LOCATION is the number one determining factor in the price per acre of farmland.
Where Can I Find The Cheapest Farmland
The following is a list of the farmland in the US with the lowest price tag per acre.
This data will, of course, fluctuate. Be sure to check prices on your own if you are interested in learning more about each area.
1. West Central Texas – $600 per acre
The parcel we looked at priced at $600 per acre was located in Scurry County. It ranks high in quality because of its soil, that’s clay and sandy loam; amount of rainfall, which is 20-24 inches annually; and low cost of producing crops. Farms in this area generally grow wheat and hay.
2. South Central Florida – $1,000 per acre
You will want to look around Highlands County and nearby areas. Soil is sandy and rainfall is 54 inches per year. Farms here grow citrus, vegetables and hay, as well as raising cattle.
3. Northern Missouri – $1,400 per acre
Sullivan County and surrounding areas give you the best bang for your buck, based on our research. Soil is silt loam, clay and sand. Rainfall is an abundant 36 inches per year. Farmland here is used as pasture land and to produce hay.