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| I’m not gonna deny this market has fooled my calculator pretty badly, particularly the last 5 years. And it was chiefly because of the ultra low interest rates as much of a factor as good prices. But prices weren’t always sensational in that timeframe either. But interest rates were. I personally believe those levels will not be seen again. These interest rates are affecting everybody big time. It affects me in my equipment business. Many of the items I sell come with a very large price tag. A 24 row well equipped striptill rig approaches $400,000, depending on options. To step up to the plate and order these to have on hand for my customers is a very expensive proposition. I’ve decided, and told my company reps who are begging for orders to keep their factories busy, effective last Jan 1 that I am not placing any more orders for dealer stock. Customer wants one, he needs to get it ordered. It’s just entirely too costly to pay the juice every month on dealer floor plans. All that being said, hard to imagine a scenario where land is immune to these same economic conditions every other business is dealing with. I’m not the only one that reported an eye opening land sale. Mafrif reported many of the auctions in his area, and his area his good land for sure, have been no saleing at around the $110 CSR point area. Don’t shoot the messenger, although I’m sure you will anyway. It’s a basic economic principle that it requires greater and ever greater news to support a bullish market, and continue its meteoric climb such as we’ve all witnessed in the land market the last ten years, and in particular the last five has been nothing short of breath taking. I’m going to turn the question around on you, where do You predict we will be in five years and why. My opinion is interest rates are going to continue to work on these land values, grinding lower and lower till something comes along to stabilize things. I’m in the investment world. Folks that used to buy land as investors because other safe investment choices such as CD’s royally sucked, the 2 1/2% cash returns looked pretty favorable on land at the time. Today, they can get over 5% and have their interest direct deposited every month to their checking account. Don’t think for one second that isn’t swaying many of these folks that would otherwise buy land. Interest rates are the major driver to this whole deal. You asked my opinion. Gotta go. Over and out
Edited by Boone & Crockett 5/5/2024 10:21
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Response to Boone And Crocket's Land bulls
