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Local land values level off, decline

By
Mavis Fodness

For the first time in 15 years, tillable land in Rock County decreased in market value.
That was one finding reported by Rock County Land Records Office Director Tom Houselog during the county’s Board of Appeals and Equalization meeting Tuesday night, June 16, in the Rock County Courthouse.
Rather than double-digit land value increases, which have occurred regularly in the past, tillable land values in Rock County decreased 6 to 8 percent.
Houselog said the largest decrease in tillable acre values was in Clinton and Martin townships where land values had previously reached $14,000 to $14,500 per acre.
“The sales in that timeframe couldn’t support it, so that had an 8 percent decrease” he said.
Assessors like Houselog used qualified sales data from October 2013 to September 2014 to determine the estimated market value for property taxes payable in 2016.
When similar sales ratios are compared, the state requires the middle ratio to be between 90 to 105 percent.
Sale ratios above or below the percentages determines if a particular property value is increased or decreased, according to the Minnesota Department of Revenue website.
Lower farmland values have been trending across the state and the U.S.
According to the Farmers National Company (FNC), a farm and ranch real estate company, the trend is likely to continue.
“Harvest results of 2015 will make it a pivotal year, which could impact the land market for several years,” said Randy Dickhut, FNC’s vice president of real estate operations in a press release.
“Farm and ranch income will drive the direction. A great deal could happen between now and November.”
FNC statistics show the volume of property sales is down 40 percent over the past six months, as compared to the past two years. Land values in some areas have dropped as much as 10 percent.
Locally, Houselog noted that the number of land sales in Rock County has also declined.
“We’ve still got solid numbers on sales,” he said.
Sales of $16,000 to $18,000 per acre parcels may be transactions of the past, Houselog said, indicating sales numbers of $11,000 to $13,000 are still frequent.
“The numbers are down, but when they sell, they still bring some pretty good prices, or they are good prices in relation to our market values,” he said.
The decline in tillable land also meant a decline in farmland building values and decreases in taxes to homestead properties.
One exception to the decline is Reinvest In Minnesota (RIM) enrolled properties, where conservation acres saw an increase in value.
Houselog said six sales of more than $1,000 per acre occurred during the timeframe. For evaluation purposes, he divided RIM acres into two groups, those with trees/water and those with grass-type land.
“The trees and water are worth more,” he said, indicating sales as high as $3,475 per acre.
Acreage values held steady or had a 5-percent increase.
Overall, Rock County’s properties are valued at more than $3 billion.

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