Today I'm reporting on how farm land has remained the one bright spot in real estate. But as corn and soybean prices have plummeted from summer's record highs, there are concerns that farms may be the next bubble to pop.
Farm real estate is already starting to plateau in California, but Iowa realtor Randy Hertz says land in his part of the country is still selling at record prices. A farm he showed us was on the market for nearly $5,000 an acre. Shortly after we interviewed him, they got an offer very close to the asking price.
Even as financing gets more expensive, even if crop land prices start to fall, this is not the 1980's, when farms lost 70 percent of their value and the industry was hit by a wave of foreclosures. Today is different. For one thing, farmers usually have to put down 35-40 percent CASH to buy a farm, and the current debt-to-asset ratio in Iowa is 12 percent, which Hertz calls "super." If there is a bubble and it pops, there is a much bigger cushion. At least that's what the "experts" say.
- The ‘pardoned’ turkeys: Where are they now?
Here's another farm story which has nothing to do with the land. It's the aerial warfare being fought to protect crops. In what is a growing practice, farmers of crops like berries and wine grapes are using falcons to keep away fruit-eating birds. Check out the video.