As the saying goes, “What goes up must come down.” As we step into the fall and early winter months, I've been reflecting on this year’s land market and looking forward to finishing the year with significant farm real estate activity. With this in mind, it’s worth examining historical land cycles to understand where we might be heading next. History always teaches us something, right?

The Current Market: A Year of Plateau and Correction
After peaking last fall, the land market has since plateaued and seen corrections of about 5-15% across most regions. This pattern is familiar. We last saw a similar peak in 2012 and 2013, followed by an eight-year climb back to those previous highs, which were reached in most areas by 2021. Now, as the market moves into a gradual correction phase, it reflects a cyclical resilience seen throughout its history.
If history is any guide, we’re not likely to see dramatic declines. Land prices tend to hold steady or correct gradually, avoiding the drastic overnight drops that characterize equity markets. This unique resilience is one of the draws of land ownership.

Past Cycles and Lessons Learned
For some perspective, let's revisit the land cycle of the 1980s. Although interest rates peaked in the fall of 1981, land values didn’t reach their lowest point until 1985. It then took around 20 years, until about 2005, for land prices to fully recover. In more recent cycles, commodity prices have significantly influenced the land market. For instance, while corn prices peaked in July 2012, land values didn’t hit bottom until 2016.
These patterns suggest that while land prices fluctuate, they don't necessarily follow a quick cycle of boom and bust. Instead, they tend to recover gradually and sustainably. High-quality tracts, defined by strong soils, proper drainage, and overall farmability, offer the greatest resilience, particularly when the broader economy faces headwinds.

What Does This Mean for Today’s Landowners?
Looking ahead, I expect land prices to gradually correct. Commodity prices, particularly corn, will be important to monitor. While a spike in corn prices driven by geopolitical issues or major crop failures could potentially push land values higher, the current global supply makes this scenario unlikely. Instead, a gradual correction, much like the cycle we saw from 2012 to 2016, seems more probable.
For those looking to exit this year, this all means you still have opportunities to sell at prices that are near record levels and drastically higher than they were a few years ago. For those buying this fall or holding onto their land, know that land ownership offers a unique kind of stability compared to other investments. It’s not solely about the land’s value today, but rather the enduring worth it holds and can accumulate over time. As we anticipate increased real estate activity through the end of the year, it’s evident that owning land remains a steady investment—even when other markets face uncertainty.