The Price of ranches has continued upward and is out of synch with its historic AU x $$$$ = Price ratio and we are now going over 6k per AU. This is attributed to a couple of different things happening in the country. First we have seen an exodus from the stock market since 01 and people have invested in the real estate market instead and have seen very steady and constant gains. Second the prices of ranches are no longer tied to the grazing ability of that ranch, people are paying and paying well for scenery, hunting, solitude, trees and live water. Today if you want to make money off of a ranch you had better be thinking of something else other than a commercial cow raising a commercial calf. Third Cattle prices have been very high for the last 3 years and therefore margins have been good. If the ranch is making lots of money why sell it? Not as many ranches are going broke, many of the city owned ranches are enjoying good times.
On the flip side of things look for the cooling off of real estate coupled with higher interest rates and the wobbly cattle market to slow the upward trend of ranch prices.
On the flip side of things look for the cooling off of real estate coupled with higher interest rates and the wobbly cattle market to slow the upward trend of ranch prices.
