Residential and commercial property values and rent prices are always a hot topic in the real estate industry, and not just in Washington. But unlike anywhere else, there’ve been some interesting developments going on in the Washington farming land real estate market.
In June, the Farmers National Company released a list of land values, and to the surprise of many, Washington’s high quality farming lands scored as the most expensive, after taking the fourth place last year. The current price is $12,500 per acre, which is mind-blowing 47 percent more than it was just four years. As the journalist Mike Rosenberg writes, the state has 14.7 million acres of farms, which equals to the size of about 270 Seattles, and that’s a gigantic area to consider.
The reason I’m writing about this interesting development is mainly the fact that this steep climb doesn’t only concern farmers and people involved in agriculture investments. It has a potential on everyday life in the city as well, and more relevant to us, other property values. The higher the price that a farmer has to pay for a piece of land, the higher the price we pay for our breakfast dairy, fresh pastries or that favorite organic cider of yours.
The growing prices are caused by a predictable state of affairs: the amount of quality farmland is limited, and on the top of it all it’s being eaten up by developers for whom agriculture is the least of their concerns. Small farmers who are just starting out and trying to purchase a piece of land to farm on stand little to no chance against developers who are willing to pay a premium to build a mall or a residential complex instead.
The local farmers and real estate brokers who concentrate on farmland are getting concerned. As Rosenberg points out, the analyses taking a closer look at farmland are not as thorough as those concerning residential land, but the common trend of prices going up is a consistent centrepiece in agricultural real estate during the last few years. And the changes are really drastic — to quote Rosenberg, “using the average farm size of 408 acres and the average costs in the Farmers National report, the typical property in Washington would now cost about $5.1 million, up from roughly $3.5 million in 2012”.
The questions of where this development leads, and whether it has a direct correlation with the growing prices of residential and commercial property in WA are yet to be answered.