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The Connection Between Cash Rents and Land Values

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  • Ibendahl, Gregory A.

Abstract

The last few years have seen big increases in land values. Cash rents have also increased but perhaps at a slower rate than land values. This paper examines the ratio of land values to cash rents to determine if how cash rents have changed in relation to land value changes. This ratio is important because it helps indicate whether cash rents are a good way of controlling farmland relative to purchasing the land. Results indicate there may be a lag in cash rents before they match the level of land prices. However, this relationship does not always hold.

Suggested Citation

  • Ibendahl, Gregory A., 2012. "The Connection Between Cash Rents and Land Values," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 120055, Southern Agricultural Economics Association.
    • Handle: RePEc:ags:saea12:120055
    DOI: 10.22004/ag.econ.120055
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    References listed on IDEAS

    as
    1. Xiaodong Du & David A. Hennessy & William M. Edwards, 2007. "Determinants of Iowa Cropland Cash Rental Rates: Testing Ricardian Rent Theory," Center for Agricultural and Rural Development (CARD) Publications 07-wp454, Center for Agricultural and Rural Development (CARD) at Iowa State University.
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    Keywords

    Agricultural Finance; Crop Production/Industries; Farm Management; Production Economics;
    All these keywords.

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