Appreciation not always positive

From the Daily Record:

Morris County told: Rising land prices hurt farming

The rising value of preserved farmland and the increasing number of purchases by buyers seeking to create estate farms could be pricing farmers out of the business, according to some agriculture experts.

Susan Craft, executive director of the state Agriculture Development Board, told Morris County officials last week that her board is concerned that many of the non-farmers who purchase preserved farms do not farm the land, or they engage in minimal farm operations.

“The pressure from non-farmers is affecting price,” said state agriculture development board member Gary Mount.

The farmland preservation program, begin in 1983, is designed to both preserve the farmland and the industry of farming, Craft said.

She is visiting New Jersey’s 21 county agriculture development boards to alert members to the issue and to seek ideas about how to change the preservation program to help farmers maintain access to the land they need.

Farmland values are affected by rising home values, Craft said.

The good news, she said, is that preserved farmland values are rising, but that also means that farmers might not be able to purchase preserved farms if they come up for resale.

In Morris County, from 2000 to 2005, the value of an acre of farmland before preservation rose from $20,658 to $52,408. The value of an acre of farmland after it was preserved and development was restricted by a deed rose in that same period from $4,211 to $20,773.

“Residential land values are rising,” Craft said. “The question is what to do about it. For farmers the issue is who can afford what land and what to do about making a living there.”

This entry was posted in Economics, New Jersey Real Estate. Bookmark the permalink.