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| Rents have been going up steadily for a while in our area, but not so much $300-$400. Lots of $250 though. We can yield 200bpa, but it's far from guaranteed. There will always be someone that needs to be a 'leader' on rent rates and pay more than anyone else, but most folks probably don't pay 1/2 of the biggest rents. However, as high prices and decent yields get to be more of the norm, good landlords tend to ask and farmers (like me) are willing to pay. Probably the toughest part is dealing with the monsterous amount of dollars. All that said, if prices stabilize around $6, inputs will climb as well. Good landlords usually recognize the whole story, so it's not like 'you grossed $900 so I want $800'. Instead I think we'll see steady $50/acre jumps until we get over $350 and then maybe smaller steps. Most folks on both sides of the land are not completely comfortable with the higher prices - it's new territory with new challenges (seems like you could go broke much faster than before - I guess that's progress).
thanks,
Pat | |
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Cash rents, how much change.
