Marking the second consecutive year of value declines, the all-land category across the entire state of Nebraska for the year ending Feb. 1, 2016 averaged about 4% lower than the prior year, according to findings from the University of Nebraska-Lincoln Farm Real Estate Market Survey.

Land value varies across state

Here are several highlights of the most recent UNL Farm Real Estate Market Survey

• The statewide all-land average value for the year ending February 1, 2016, averaged $3,115 per acre equating to an approximately 4% ($135 per acre) decline over last year’s value of $3,250 per acre.

LAND VALUES DECLINE: Nebraska farmland values have declined for the second consecutive year. The statewide all-land average value for the year ending Feb. 1, 2016, averaged $3,115 per acre, equating to an approximately 4% ($135 per acre) decline over last year's value of $3,250 per acre.

• Declines in the all-land average varied across Nebraska. The Northwest, North, Central, Southwest, and Southeast districts averaged around 5% lower, whereas the Northeast, East, and Southwest districts declined at 3%, 2% and 8%, respectively.

• Panel members indicated purchases for farm expansion and 1031 tax exchanges as the two most positive factors influencing land value increases, but these factors were noted as only being slightly higher than neutral. General expectations among panel members weakened for future increases in land value.

• Current crop prices once again were listed as the most negative factor for the second year in a row by panel members as leading to the decline in land values across Nebraska. Additional concern among panel members indicated property taxes may have a negative bearing on the value of agricultural land, depending upon future policies.

• Based on 2016 market values, the estimated total value of agricultural land and buildings in Nebraska has declined to $132.0 billion. Between 2015 and 2016, the decline in agricultural land and building values totaled about $5.8 billion.

• The Nebraska all-land average price of $3,115 per acre marks a 4% decline and the second consecutive year of lower weighted average farmland values in the state, as commodity prices for crops and livestock continued trending lower from record-setting levels.

• Declines in cropland generally trended lower across the state. Gravity- and center-pivot-irrigated cropland trended lower at $6,480 and $6,940 per acre, respectively, for declines of 6% and 5%, respectively. Dryland cropland with irrigation potential also fell 5% to an average of $4,785 per acre, but dryland cropland without irrigation potential recorded a slight uptick of 2%, to $3,470 per acre.

• Hay land used for forage production recorded the highest rate of decline for 2016 at 17%. Compounding effects from the drought of 2012 for forages led to increased demand for hay land, with record-setting hay prices. Adequate precipitation and lower hay prices in 2015 resulted in lower hay-land values seen across the major cow-calf producing regions of the state, including the Northwest and North.

• Demand for pasture or rangeland slightly receded, as grazing land (non-tillable) declined 3% to $975 per acre, whereas grazing land (tillable) dropped 1% to $1,495 per acre. The rate of change for these two land types greatly varied across the districts, ranging from a negative 7% to a positive 7%.

View the full report at  agecon.unl.edu/documents/2016-nebraska-farm-real-estate-report.pdf .