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West Tennessee | My thoughts? They are too high but that doesn't seem to stop anyone from paying more. That has cooled off a little here since a few have decided to call it quits. In our county there is good river bottom ground that is as good as any anywhere. We also have a lot of hill ground that is subject to drought on the high parts and being wet on the lower parts. I talk to people every single day and the rents they are paying will not pay anything above direct costs with the current price situation and at an average yield. They know this. If we have a below average yield at these prices then they will easily go negative on those farms. I have to assume that they are willing to risk a few years in the negative on a few farms in order to control more ground and make profit in future years. Many people who own ground basically calculate that they pay no rent on that ground, which looking at cash flow, they don't. To me they are spending the rent they could have received but it doesn't matter because as long as they cash flow they're good. EVERY situation is different for sure. I can't bid ground up high because the ground I get to bid on isn't always the best and I need to keep my STO viable irregardless of what others can/will do. The number of acres won't matter to me if I can't make any money working it. My thoughts. | |
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Land Rent Question
