Farmland Auctioneer Talk

January 20, 2022

I have a ton of topics running through my head currently about farm real estate. So here’s a brain dump on this COLD Iowa winter day!

Banana Bread Muffins and Walnuts from Grandma’s Farm

Okay first, I just have to start by sharing that I made banana bread muffins the other night. Since I had ripe bananas. As I was eating one this morning, the muffin reminded me of when I would make banana bread with my mom when I was little and how my grandma would always pick her own walnuts off the farm! There was something so heart warming about this and of course delicious! Does anyone else have memories linked to objects or things like this? It’s crazy how just a muffin can trigger such emotion!

Who Will You Trust To Sell Your Farm?

My broker (and boss) Jason, shared this video with me recently. It really made us think about what makes a person hire a certain land company to sell their farm. Is it the so called performance statistics that draws sellers to hiring a certain auction company or listing agent? Such as number of acres sold, dollars sold, number of clients served, and claiming to be the leading farm real estate auctioneer or agent business?

Or do sellers look for someone who they can trust? Someone who has the qualities, knowledge, and tools to guide them to a successful sale. Even though that auctioneer or agent might not be the “top dog?” Here’s the video for reference:

Farm Real Estate

For someone that started in the farm real estate business just a few years ago, I often compare myself to the “top dogs”. Ones that have sold thousands of acres, millions of dollars, and always seem to be having a new auction. The scary thing though is that the auction business in Iowa is not regulated. It may surprise you but there are no licensing laws to becoming an auctioneer. Anyone in Iowa can wake up and say, “I’d like to be an auctioneer”. However, there are laws and licensing requirements to being a realtor in Iowa.

Are You the Seller the Number One Priority or is the Buyer?

From someone who works in this industry, I’m warning you that there are some high performers that are very un-trustworthy. Just like the video pointed out above. When it comes to selling your most valuable asset, make sure you’re hiring someone who can back up their statistics, provide evidence, and hire someone who’s full interest is helping you as a seller. There are some sneaky deals that have happened with other Iowa land companies. For example, I’ve seen deals where a buyer benefits more from the sale than the seller. This happens more than you think. At DreamDirt though, sellers are our number one priority. We are here to provide you a safe, stress and worry-free farm sale. While achieving the highest result for you farm auction or listing!

Auctioneer School

I’ve taken all the classes and tests to be a salesperson (realtor) in Iowa. Currently, I’m working on becoming a broker as well! This helps serve my auction clients since I have the knowledge of real estate law that many auctioneers who are not licensed real estate agents do not have! In March, I’ll start my second year of CAI (Certified Auctioneer Institute) school. This 3 year program is a pristine designation for auctioneers that want to learn more about the auction industry. Even though it’s not required by law.

Full-time Farm Real Estate Auctioneer and Agent

Along with all the continued education classes I’ve taken, I honestly learn something new every single day by working closely with the DeamDirt team. My full-time job is farm real estate. Many other auctioneers and agents only help clients as a side hustle or part-time job on their free time. I’m involved in farmland transactions, advertising, client calls, customer help, and more all day – every day! One of my first farmland auctions was back home in Dallas County, IA. Just down the road from where I grew up in Adel. The client was a mutual friend. They put a lot of trust into me being a young professional in this industry. Her testimonial still means the world to me!

“Thank you Rachel Hoy. We have been friends with Rachel for several years and don’t let her age fool you, she knows her stuff and is a true professional. We appreciate all her help from start to finish.” – Mandi Orman, Dallas County, IA

You Never Know Who’s Watching You

I received a message the other night from someone I went to Iowa State saying she had inherited land with other co-heirs and had been following me since I started after college in 2018. Honestly, I was a little surprised to see her message since I often don’t get a whole lot of feedback on my facebook posts, blogs, or some videos. She said she had read my most recent blog about 6 easy steps to selling farmland and that made me so excited! I have a ton of great free resources for anyone interested in selling land in Iowa and want to help as much as possible! I love answering questions from my clients and sharing how I can help them through the land seller journey.

I spend a lot of time on TikTok. Probably more than I want to admit but it’s a great place to learn about topics you’re interested in. Lately I’ve been sharing videos about recent farmland sales in Iowa and average per acre prices for the 99 counties in Iowa. I’m trying to provide valuable content that can help someone better understand the farmland selling process and the farmland market in Iowa. With a little entertainment here and there showing my background of growing up on a farm in the mix!

If you’re thinking of selling farmland, now is a great time of year to do so! To get started, fill out my contact form below or click here.

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Goals for 2022 and Weekend at Farm Reflection

January 3, 2022

New Year’s Eve

So much is on my mind right now for some reason. Thinking about what makes me happy, goals for 2022, what I should talk about related to farm real estate, my family’s history, and the family farm.

This weekend I’ve been home with my dad at our family farm outside of Redfield in Dallas County, IA. My husband, is currently in Oklahoma City for the Cattleman’s Congress Livestock Show for his job. When he is gone, I like to come hang out on the farm and stay with Dad for a few days and catch up.

Friday was New Year’s Eve, and I was going to go out and be with friends but we got an ice storm and roads were slick so I stayed home and was in bed by 9pm. I know right?!? I’m lame and getting old!

Who else did this?

Happy 2022!

Saturday we all woke up to a new year! Happy 2022! Like the majority, I wrote down my goals for the new year which I typically don’t do, however I really focused on what I want to accomplish this year and task that will help me accomplish those goals. I also jotted them down in my notes on my phone so I can look at them every day. Why not put my goals where I can easily access them instead of a journal or notepad? I also am liking the idea of making a dream board so I can visually see my dreams when I’m in my home office to keep me motivated. Here are my goals for 2022 and tasks to keep me accountable:

Goals need a plan and actions to help you achieve your goals

My 10 Goals:

  1. Do things that make ME HAPPY
    • 1. Action: Find at least one thing that makes me happy and add to 365 list each day
  2. Spend more time with Family and Friends
    • 1. Action: Set phone down when with company
    • Action: Schedule more dates and say yes for meeting up!
  3. Make more improvements on the farm
    • 1. Action: Be more present with Dad when home and utilize his help
    • 2. Action: Get outside!
    • 3. Action: Start on small projects
  4. Be more spiritual and practice my faith
    • 1. Action: Journal
    • 2. Action: Recognize signs from angels
    • 3. Action: Pray during the good and bad
  5. Be more active
    • 1. Action: Move my body for 5 minutes if I don’t feel like working out – should encourage me to keep going and complete 30-45 minutes of exercise
    • 2. Action: Take Dude on as many walks as possible!
    • 3. Action: Sign up for classes at the Crew Center
  6. Be a loving wife
    • 1. Action: Get ready in the mornings even though I work from home
    • 2. Action: Ask how Bryce’s day was and don’t complain about the small things
    • 3. Action: Set phone down at night when together and talk about our future, our goals, learn something new, our cattle herd, etc.
  7. Grow my farm real estate business:
    • Action: Create content for sellers and buyers
    • Action: Show my face more and network
  8. Eat a balanced diet
    • 1. Action: Portioning plate and include all varieties of food categories
    • 2. Action: Allow myself to have cheat meals follow 80/20 rule
    • 3. Action: Try new foods! Order Hello Fresh and Whole and Hearty Meals To – Go
  9. Drink Less Alcohol
    • 1. Action: Drink at least 100 oz of water per day
    • 2. Action: Only drink socially
    • 3. Action: Focus on progress and take it day by day
  10. Read before bed
    • 1. Action: Set phone down at night
    • 2. Action: Buy used books and sell ones I have read
    • 3. Action: At least 10 pages

Weekend Re-set

I’ve always been an open and honest person and sharing my goals to the public is uncomfortable but I hope it inspires you to try some of my goals and action tasks as well!

Now back to the weekend, I had a very relaxing snowy Saturday! I did clean up Dad’s house some, worked out, read, and went outside for about 5 minutes since it was COLD!

Sunday, I was up before 8am and Dad had already done chores. I’m determined to get out of bed one of these mornings early to help feed cows while I’m home! There’s something so rewarding about feeding livestock the depend on you it’s hard to describe but it always puts me in a good mood even if it’s below zero!

Farm House Projects

I asked Dad what projects I could help him with and we decided it was time to clean and organize the office room. It’s been a hard year on our family since my grandma passed away December of 2020. We spent majority of last January and February moving into the farm house and it’s hard knowing what to keep, give away, sell, or throw away. I feel so guilty trying to update and make grandma and grandpa’s house our own and changing out a few things. Going through the office though was a good first step.

My sister and I did do good work on the upstairs bedrooms this past year but the main floor and basement could still use some work. The office looks so much better and Dad was thankful I kept after it all day. Finished the evening by watching some football, doing some yoga and stretches and reading before bed.

Monday Morning Motivation

This morning I took Dude, my golden retriever, to the vet for his annual wellness exam at Adel Vet Clinic and grabbed a coffee from The Morning Grind. The roads are still covered in snow and icy in areas but not terrible.

Today I am focused on growing my business and how I want my work days to look like. I’ve been with DreamDirt for a little over three years now and am a full-time farmland auctioneer and real estate agent. I love creating content on social media for sellers and buyers and communicating with clients. If you’d like to see some short videos about farmland in Iowa follow my Tik-Tok and Facebook page! Helping land owners become more educated on the farmland selling process is my main priority, and I enjoy answering your questions!

Future of Farmland

Farmland Seller Resources

I have several great free resources if you are ever in the position of selling farmland or know someone who is! All you need to do is fill out my contact form and I’ll get back to you ASAP! I offer free farmland market evaluation consultations and please think of me and the team at DreamDirt when it comes to selling farm real estate.

Take care and stay warm!

Rachel

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Iowa Farmland Market Results

June 28, 2021

Tillable Land Sold During June 21st – 27th

From $7,500/acre to $17,500/acre….Check out these recent farmland sale results!!! Farmland market is as hot as it is outside here in Iowa! Farmland auctions in June have really turned up the heat! Get started selling farmland today by filling out my questionnaire!

LINN COUNTY, IOWA LAND AUCTION

  • 90.69 acres
  • Online Virtual Auction
  • Located near Walker, IA
  • Sold for $9,800/acre
  • 97.8% tillable
  • 59.2 CSR2
  • $165.5/CSR2

HUMBOLDT COUNTY, IOWA Land Auction

  • 61.38 acres
  • Online Virtual Auction
  • Located near Dakota City, IA
  • Sold for $12,400/acre
  • 92% tillable
  • 81.4 CSR2
  • $152.33/CSR2

GREENE COUNTY, IOWA Auction Results

  • 388.86 acres sold in 3 parcels
  • Virtual Live Auction
  • Located near Bagley, IA
  • Tract 1
    • 160 acres
    • Sold for $13,300/acre
    • 96% tillable
    • 86.8 CSR2
    • $153.23/CSR2
  • Tract 2
    • 148.86 acres
    • Sold for $13,000/acre
    • 96.5% tillable
    • 83.10 CSR2
    • $156.4/CSR2
  • Tract 3
    • 80 acres
    • Sold for $13,000/acre
    • 98% tillable
    • 79.5 CSR2
    • $163.5/CSR2

BUENA VISTA COUNTY, IA Farmland Market Results

  • 159.05 acres sold in 2 parcels
  • Live and Online Auction held at Marathon Community Center in Marathon, Iowa
  • Located near Alber City, IA
  • Tract 1
    • 153.28 acres
    • Sold for $10,050/acre
    • 95% tillable
    • 82 CSR2
    • $122.56/CSR2
  • Tract 2
    • 5.77 acreage
    • Sold for $139,000/acre
    • 2,032 sq. ft. ranch home, 3 BD, 1 Bath
    • 26′ x 32′ steel utility building, 68′ x 40′ steel utility building, 40′ x 80′ Quonset building
    • 8,000 bushels of grain storage

POLK COUNTY, IOWA Farmland Auction

  • 75 acres
  • Live auction with online bidding held at the American Legion in Bondurant, IA
  • Located near Dakota City, IA
  • Sold for $9,000/acre
  • 95% tillable
  • 62 CSR2
  • $145.16/CSR2

MITCHELL AND FLOYD COUNTY, IOWA Farmland Market Results

  • 240 acres sold in 3 parcels
  • Live auction held at CRC Events Center at the Mitchell County, IA Fairgrounds
  • Located near Osage, IA
  • Tract 1
    • 79.55 acres
    • Sold for $12,275/acre
    • 98.5% tillable
    • 94.4 CSR2
    • $130/CSR2
  • Tract 2
    • 79.51 acres
    • Sold for $12,275/acre
    • 96.4% tillable
    • 90.6 CSR2
    • $135.5/CSR2
  • Tract 3
    • 80 acres
    • Sold for $7,500/acre
    • 90% tillable
    • 58.3 CSR2
    • $128.65/CSR2

SAC COUNTY, IOWA Farmland Auction

BUENA VISTA COUNTY, IOWA Land Auction

  • 80 acres
  • Live auction held at the Vaudt Distributing in Rembrandt, IA
  • Located near Rembrandt, IA
  • Sold for $12,000/acre
  • 96.8% tillable
  • 87.7 CSR2
  • $136.8/CSR2

HARDIN COUNTY, IOWA Farmland Auction

  • 80 acres
  • Live auction with online bidding held at the Radcliffe American Legion
  • Located near Radcliffe, IA
  • Sold for $14,300/acre
  • 98% tillable
  • 85.4 CSR2
  • $167.4/CSR2

LINN COUNTY, IOWA Farmland Market Results

  • 160 acres sold in 2 parcels
  • Live auction with online bidding held at Columbus Club in Cedar Rapids, IA
  • Located near Marion, IA
  • Tract 1
    • 80 acres
    • Sold for $17,250/acre
    • 93.4% tillable
    • 92.5 CSR2
    • $186/CSR2
  • Tract 2
    • 80 acres
    • Sold for $17,500/acre
    • 99% tillable
    • 91.9 CSR2
    • $190.42/CSR2
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5 Ways to Save Money When Selling Farmland

June 18, 2021

Farmland owners! Are you thinking of selling some farmland real estate and concerned about how much it will cost to sell? You can certainly try to do for sale by owner. I’m not stopping you from trying but there are some dangers that come with FSBO. Instead, try these 5 cost saving tips when choosing to sell by auction or listing! Save your money!

Want to save over half of commission costs? Hire an auctioneer instead of realtor!

I come from an auctioneer and realtor background. I’ll be the first to tell you that hiring auctioneers will save you thousands! Typically, realtors will charge you twice as much in commission costs compared to auctioneers! Realtors will often split commission with a buyers agent so you are paying 2 agents instead of 1.  You are paying for your agent and also the buyers realtor! To compensate for the cost of the additional brokerage coming from the buyer’s side, a listing realtor will typically charge more than double! In-case they need to split the commission 50/50 with buyer’s side. This is why hiring an auctioneer can save you over half of commission!

At DreamDirt Farm and Ranch Real Estate where I work, we don’t offer cooperative brokerage for auctions in most cases. It’s not necessary and does not serve our client well. We are dedicated to finding buyers for your property. Since your auction is open to the public, and with our exceptional marketing and advertising, buyers are able to find your land auction and are welcome to bid! Realtors often ask us to share commissions on our auctions hoping to bring the buyer. However, we’ve found that with our advertising on Zillow and many other aggregation websites the buyers are already exposed to the listing. Buyers agents never serve to improve the outcome of your auction . This helps you save money on commission costs since you are only paying us and not the buyer’s agent. Our commission is typically 1-5% for land auctions, which is considerably low compared to 5-10% realtors charge. 

Choosing an Auction over a Listing for Sale can save you money and time!

If the first money saving cost tip didn’t convince you to market your property by auction, here’s another reason! 

Our auctions typically take 60 days to complete. This includes 30 days of having your auction open for bidding. Followed by 30 days following for closing process with new buyer. We have found 60 days to be extremely effective! The 30 days gives us time to get marketing and advertising out the door. This gives bidders plenty of time to arrange financing. When compared to a listing, auctions create a sense of speed and urgency to get bids in on the property.

Listings don’t have a date attached. This gives buyers more time to dwell on the idea if they want to put an offer in or not. Some buyers like to wait the seller out and wear them down.  Some of our past sellers have even mentioned they have tried selling their land to neighbors. The neighbors said they had interest, but the sellers never got a clear answer or offer right away. Once they hired us to do the auction, then the neighbors saw the sellers were serious about selling! Bids were placed before time ran out for opportunity to purchase neighboring land.

The 60 day time frame is also a huge plus when it comes to costs and saving money!

When selling property, you need to keep in mind that you continue paying taxes, insurance, and maintenance in the time period of selling. With a 60 day auction process, you can save thousands when compared to if your listing took longer than 60 days. Imagine if it took an extra 6-12 months to receive an offer. You’d be done paying on taxes, insurance, and extra costs months ago if you did an auction!  Not only do you save that money, you put it to use earlier on something which contributes to more saving.

One last tip for choosing the auction method, is to have an online only timed auction! Live auctions where bidders come to hear an auctioneer chant are typically more expensive to the seller. This is because you’re incurring more costs for more peoples time, costs of the venue, travel, refreshments for the crowd, printed items, insurance, and set-up fees. Hint: Ask to have an online only auction to save more in commission and fees. 

Choose the right marketing package! Do you need the whole works or just want a little advertising?

This is where you can save some GREEN! Advertising cost add up fast! At DreamDirt we charge no marketing and advertising fees for properties valued over $250,000. If you’re curious of how much your property is worth contact me today! Other companies may charge you for newspaper ads, flyers, drone video, postcards, digital ads, etc.! If a company you are interested in charges for marketing, make sure you understand where exactly your money is being spent. Some of our past sellers who didn’t meet our free advertising offer have decided to have us use photos instead of a video, and digital ad instead of print advertising.

When deciding how much advertising you want done for your farm, also take into consideration the quality of the marketing. Does the company produce appealing flyers and videos? Do they make it all in house or hire a third party? DreamDirt’s advertising is done all in house which makes it more affordable for our sellers!  

Commission costs still too high for you as a seller? 

Have you heard of Buyer’s Premium? It’s a way you can save on commission cost by charging the buyer a percentage on top of his final bid. This helps pay for costs of the auction. The auction serves the buyer and seller both.  With a 4% commission for example, you could pay for 2% and charge the buyer the other 2%. It’s completely up to you as a seller how you offer the property. 

With an auction you set the rules and the buyers bid accordingly. The buyer’s premium may reflect in the amount bidders are willing to bid. Bidders know they’ll owe and additional percentage on top of their bid and some it may not. We see it some in Iowa but other states and areas it’s more common. We just finished this auction with a 2% BP in Buena Vista County, IA and have also sold land in Kansas with Buyers Fee of 5%.

Compare several companies and don’t be afraid to negotiate costs and fees!

Most landowners only get one shot at selling land in their lifetime. My biggest piece of advice is to become educated on the process! Also interview companies you are interested in hiring to sell your most valuable asset! If you’re nervous about paying commission don’t be afraid to negotiate! It may surprise you what we can come up with. I’ve had sellers choose less commission percent but pay for marketing up front. The have set up a commission scale depending on what the farm sells for. Most choose the no risk option of only paying commission once the land is sold. At the end of the day, I want you to be comfortable with hiring me as your auctioneer at a price we can both agree too. I offer a free consultation and proposal for interested sellers to get started with the land selling journey. Start here today!

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Rachel Hoy

Iowa Farmland Sales Update

May 26, 2021

May 3rd – May 26th

Hello! A lot has happened in the last 3 weeks since my last farmland market blog! Currently, there are 409 active listings in Iowa with an average listing price of $7,802/acre! Three land auctions coming up this week in Dallas County, Palo Alto County, and Cherokee County. I’ll post results from these auctions in next week’s blog. Here’s sold prices from the last three weeks auctions! The land market is still incredibly strong and right now is a great opportunity to sell if you’ve been think of doing so! Get started today by filling out my short questionnaire.

JEFFERSON COUNTY, IOWA 207.56 ACRES ABSOLUTE FARMLAND AUCTION

  • City: Fairfield, IA
  • Live Auction Held at Activities Building on the Fairfield Fairgrounds
  • Sold in 2 Tracts
    • Tract 1 – 135.01 acres
      • Sold for $8,400/acre
      • 92% tillable
      • 64.05 CSR2
      • $131.14/CSR2
    • Tract 2 – 72.55 acres
      • Sold for $8,000/acre
      • 97% tillable
      • 63.9 CSR2
      • $125.20/CSR2
Tract 1
Tract 2

HENRY COUNTY, IOWA 76 ACRES FARMLAND AUCTION

  • City: Windfield, IA
  • Online Only Auction
  • 75.68 surveyed acres
  • 100% tillable
  • Sold for $13,750/acre
  • 84.7 CSR2
  • $162.34/CSR2

JEFFERSON COUNTY, IOWA 118.87 ACRES FARMLAND AND HOME AUCTION

  • City: Fairfield, IA
  • Timed Online Auction
  • Sold in 3 Tracts
    • Tract 1 – 37.87 acres
      • Sold for $12,200/acre
      • 96.2% tillable
      • 74.2 CSR2
      • $164.42/CSR2
    • Tract 2 – 78 acres
      • Sold for $13,050/acre
      • 98.8% tillable
      • 78.5 CSR2
      • $166.24/CSR2
    • Tract 3 – 2 Story Home with 2 acres
      • Sold for $140,000
      • Built in 1900
      • 2,052 sq ft
      • 3 bed, full bath
      • Sheds, barns
      • Grain bins
Tract 1
Tract 2 and Tract 3

PLYMOUTH COUNTY, IOWA 41 ACRES PASTURE LAND and ACREAGE AUCTION

  • City: Hinton, IA
  • Live and Online Auction, held at farm 28224 South Ridge Road Hinton, IA 51024
  • Sold in 2 Tracts
    • Tract 1 – 37.87 acres
      • Sold for $8,100/acre
      • Pasture acres
      • 45.6 CSR2
      • $177.63/CSR2
    • Tract 2 – Home and Acreage 6.7 acres
      • Sold for $150,000
      • Single story, built in 1920
      • 2 bedroom
      • 1,176 square foot
Tract 1
Tract 2 Acreage

PLYMOUTH COUNTY, IOWA 190 ACRES DEVELOPMENT LAND AUCTION

  • City: Merill, Iowa
  • Live and Online Auction, held at farm 2801 C-44 Merrill, IA 51038
  • Sold in 4 Tracts
    • Tract 1 – 135 acres
      • Sold for $8,500/acre
    • Tract 2 – 33 acres
      • Sold for $10,100/acre
    • Tract 3 – 22 acres
      • Sold for $6,600/acre
    • Tract 4 – 4 acres with living quarters, storage and grain handling facility
      • Sold for $575,00

HARRISON COUNTY, IOWA 100 ACRES ABSOLUTE LAND AUCTION

  • City: Woodbine, Iowa
  • Online Only Auction
  • 43.76% tillable
  • Sold for $8,550/acre
  • 60.9 CSR2
  • $139.57/CSR2

PAGE COUNTY, IOWA 39 ACRES RECREATIONAL LAND AUCTION

  • City: Clarinda, IA
  • Online Only Auction
  • With new cabin
  • 9 acres of CRP
  • Sold for $4,600/acre

DALLAS COUNTY, IOWA 81 ACRES FARMLAND AUCTION

  • City: Redfield, IA
  • Live and online auction held at: Redfield American Legion
  • Gas storage lease
  • 99% tillable
  • Sold for $13,750/acre
  • 88 CSR2
  • $156.25/CSR2

Check out DreamDirt’s current auctions here!

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Iowa Farmland Auction Update

May 5, 2021

Week of April 26th – May 2nd

Hi everyone! There were only two farmland auctions this week in Iowa. We are starting to see fewer auctions each week leading into the late spring/early summer crops now that everyone is getting crops in the ground. Here are the results from both farmland auctions:

Dallas County, IA 83 Acres Farmland Auction

  • City: Adel, Iowa
  • Live Auction Held at Redfield Legion Hall
  • 83 acres near KAO Campground and I-80 interstate
  • 72% tillable
  • Sold for $10,800/acre

Muscatine County, IA 349.51 Acres Farmland Auction

  • City: Nichols, Iowa
  • Live Auction Held at Lone Tree Community School Wellness Center
  • Sold in 5 Tracts
    • Tract 1 – 70.87 acres
      • Sold for $9,500/acre
      • 92% tillable
      • 74.1 CSR2
      • $140/CSR2
    • Tract 2 – 85 acres
      • Sold for $10,000/acre
      • 94% tillable
      • 76.7 CSR2
      • $139/CSR2
    • Tract 3 – 86.6 acres
      • Sold for $8,200/acre
      • 92% tillable
      • 68.9 CSR2
      • $129/CSR2
    • Tract 4 – 84.23 acres
      • Sold for $6,700/acre
      • Pasture
      • 66.5 CSR2
      • $100.75/CSR2
    • Tract 5 – 22.81 acres
      • Sold for $8,150/acre
      • Development
      • 54.9 CSR2
      • $148.45/CSR2

April Total Farmland Acres Sold By Auction: 3,501 acres

Thoughts from Iowa Land Auctioneer, Rachel

Now that we are 4 months into 2021, we are starting to become more aware of how the rest of the year may fold out. Commodity prices were gradually increasing throughout March and April, and have really hit some high prices! We haven’t seen some of these prices since 2011!

Supply and Demand

Coincidently higher commodity prices = higher land values. More farmers are looking for more land to farm because of the rise in corn and bean prices; which drives demand up. However, there is still a shortage of available land for sale creating low supply. Now I’m not an economic wizard, but I did take a few economy classes at Iowa State University while in college and what I learned was; when there’s low supply and high demand that equals higher prices. Just like what we are seeing with land auctions right now.

Are you looking to finally retire from farming and would like to enjoy all your hard work? Have you recently inherited some land and looking to sell all or part of it? Needing to downsize your operation?  

The key is, if you are slightly even thinking of selling farmland, do it now before everyone gets the right idea too! As a seller you want to sell while there’s still a low supply. Once more land comes to market in the Fall and after harvest, we might see a dip in prices than right now currently while supply is low.

So, if you’re thinking you want to sell now while the market is hot – I can help you adjust terms and conditions of your auction to reflect rent income or crop income for selling to a new owner half way through the crop season this summer.

I’ve been selling land for two and a half years now and have never seen such high land auction prices! I have the tools to help you sell land by live auction, online timed auction, or even listing at DreamDirt Farm and Ranch Real Estate, LLC. I can help you get started with the selling journey by creating a proposal and scheduling a free consultation with you! Fill out my questionnaire to get started!

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Farmland Auctioneer

March 30, 2021

When I first meet someone and introduce myself as an auctioneer I get some strange looks. My family and friends also have troubles grasping the fact that I’m an Iowa farmland auctioneer. Why is this? When most people hear the word auctioneer, they picture someone chanting. I don’t have the talent to do so or know what words to say in a chant. However, I am an Iowa farmland auctioneer and here’s why.

Definition of an Auctioneer

According to the National Association of Realtors, an auctioneer is,“The person whom the seller engages to direct, conduct, or be responsible for a sale by auction. This person may or may not actually call or cry the auction.”

There are several auctioneer schools around the country that offer different types of classes and designations. World Wide College of Auctioneering in Mason City, IA helps those who are interested in learning how to chant. I know many auctioneers that have been to this school. However, I knew it wouldn’t be the right fit for me. I wanted to learn more about the business side of the auction industry and strategies to best serve my clients.

Jason Smith and Tom Bradley, (brokers, and auctioneers of DreamDirt), both suggested I attend Certified Auctioneers Institute (CAI) School. CAI is hosted by the National Auctioneers Association. It is a three-year program and covers auction methods, improving business skills, staying up-to-date with technology, networking, and becoming a leader.

I couldn’t wait to sign-up and get started on my CAI journey after hearing what all it has to offer!

Certified Auctioneer Institute School

Even though CAI was going to look different this year due to COVID, I still wanted to attend. Typically, the class is held in Bloomington, Indiana at the University of Indiana. With COVID gathering limitations, the NAA decided to host the class virtually. I’ve used Zoom before when meeting with clients. Yet, I didn’t know what to expect from taking this class over a period of 5 days all online. CAI starts on a Sunday and goes through Thursday. By the time Thursday came, I was familiar with everyone in my class! I was able to network even from my own home office!

Using Zoom for Online Class
CAI Class of 2023 meet over Zoom our first year! Here’s a few of my classmates!

During our introductions on Sunday, I quickly realized the majority of my classmates come from an auction family. Which made me sit back and think, do I know anyone in my family that was/is an auctioneer? The answer: no. Wow! I am a first-generation Iowa farmland auctioneer and the only one in my class from Iowa! What also surprised me was out of the 40 auctioneers in my class, there are only 8 of us females! We also represent 17 different states and specialize in selling all different types of assets. My class consist of a wide range of benefit, personal property, commercial real estate, farm machinery, and land auctioneers. We all specialize in selling different assets, but are still helping each other!

Auction Proposal

Besides listening to our speakers, we also worked in groups to present an auction proposal. My group’s assignment was to compose a professional proposal to present to the seller’s of a brewery. Since we were all working over Zoom, we built communication skills and showed our strengths through group work. This group proposal was practice for our individual work which includes submitting an auction proposal by August 1st. A proposal is required in order to advance to CAI Class II next year.

CAI 2022 Benefit Auction

While working on our proposals, we will also be planning to host the CAI 2022 Benefit Auction. I’m the administrator of the executive team and will be handling communications between our committees for the coming year. I’m excited to help coordinate the best benefit auction for next year!

Licensing Requirements of Real Estate Salesperson versus Auctioneer in Iowa

After become a licensed salesperson in Iowa, I found it odd auctioneers in Iowa don’t need a license.

I’ve been in the auction industry since late 2018 and have seen a lack of professional and educated auctioneers. Yes, I’m an auctioneer in Iowa because there is no licensing requirements in this state. Even so, I wanted to become educated and more knowledgeable about auction business. This is where CAI school comes into play.

Taking Action!

I decided to enroll in CAI school to help set myself apart from the rest of the industry. Less than 850 professionals currently hold the CAI designation and I want to become one of the elites. I will stay up to date with the best practices in the auction industry, laws, regulations, and conducting business. I’m taking it upon myself to invest into furthering my education in order to protect and best serve my clients

I’m here to help!

Selling farm assets is a very complex process. I suggest hiring a professional who is willing to dedicate their time into becoming the best Iowa farmland auctioneer. I can explain the auction process and guide you along every step of the way. Not just calling for bids and chanting.

Contact me at 515-954-8063 or rachel@dreamdirt.com to get started with a free consultation. Get to know me more my watching this video!

Selling land by online auction
Photo was taken of me after our Live and Online Auction for the Larry Schenkelberg Estate Land Auction consisting of 813 acres in Carroll and Greene County, IA
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Land Auctions vs. Listings

December 15, 2020

So, you’re thinking about selling your land, but not sure if you should have an auction or list the farm.

Selling land is a huge process and you only really get one chance at it. Should I start with an auction first or listing? This decision is important to make sure you get the most money for your land and done correctly the first time. 

From my experience of helping landowners, I would recommend an auction first. Does the word auction scare you? Do you feel that it is a last resort option and your land will sell for cheap? What price should I list my farm at?

I’m going to lay out the key differences between auctions and listings to give you a better idea of why you should not feel nervous about having an auction, and why I think they produce the best results for you. 

How Land Auctions Work

When I was younger, I would picture the word auction as people gathering in a room and eating donuts and drinking coffee while getting ready to raise their hand and bid when the auctioneer started chanting. Today though, I picture auctions differently.

Online Land Auctions

I think of bidders competing against each other bidding to their maximum potential and producing incredible sale results. Not necessarily done in-person. Online land auctions are becoming more popular than ever before! When done correctly they are the most powerful way to sell land. 

Be careful! When deciding what auction company to use, make sure you are choosing someone who has done online auctions for several years. With the world pandemic and the chaos of 2020, several auction companies have switched to online only auctions. Which is totally okay, as long as they understand how to properly conduct online land auctions.

Land Auction Company

Tip – look for a company that has several past sale results from online land auctions, own their own software (don’t use a third-party bidding platform), and have testimonials from previous sellers who have decided to sell their land by online only auction.

I have helped sell thousands of acres online and work with a team of auction professionals who are truly the pioneers of online land auctions. If you are curious how online land auctions work, I can send you a video of what your land auction would look like on our online bidding website!

Whether you decide to have a live in-person auction, or online only auction, these key features apply to both. 

1. Auctions have a set date

Unlike a listing, auctions have a set date and time where bidding will either begin for a live auction or when bidding will end for an online timed auction. This can give you and the bidders an idea of when the farm will sell and create momentum to get bids in. 

I know if I were a seller, I would prefer to know what day my land was going to sell instead of waiting around for an offer to come in for a listing which can take up to several months depending on buyer’s urgency. We all live busy lives, and by setting a certain date and time for your auction you know exactly when you need to be available to watch your auction and accept the bids. Offers for listings are not planned and can create stress if you are planner like me!

2. Let bidders’ price your farm

How much is your farm really worth? What if your listing price was lower than what a bidder would actually pay for it? When you put a price on your farm you are creating a cap of what you are wanting for your land. With an auction, bidders can go beyond the price and can produce results you wouldn’t have even dreamt about! How do you know what others think your land is worth? Maybe they have had an eye on your farm for several years and would pay 2x as much as what you think it’s worth. This is why auctions are the best at determining what your land is really worth and letting bidders determine how much they are willing to give. 

Prime example – I witnessed an acreage consisting of 19 acres and a house sell for $70,000 more than what the sellers thought it was worth and what they would have listed it at. They had no idea bidders were willing to go that high. Iif they did a listing, they would have shorted themselves $70,000! I don’t know about you but that’s a lot of money! The sellers were extremely happy with this online land auction that I helped coordinate. 

Auction Ladder

They way auctions work is similar to climbing a ladder. You start low and work your way up. Every time someone bids the next person has to be higher – next step on the ladder. Bidders can only work up and never back down to $0 which can happen with listings. Listings, a buyer can offer a price anywhere on the ladder and other buyers have no idea if they have to be higher or if they can submit a lower offer. If you as a seller decided to reject an offer on your listing – you start back at $0 until someone comes in with another offer. 

You also have the right to accept or reject the last bid on your land auction and to confirm the sale. This is another hefty topic though, and I wrote a separate blog dedicated to this topic, “5 Secrets to Setting an Auction Reserve”.  

3. Terms and Conditions of Auctions

One of my favorite parts of auction is – sellers get to set the terms and conditions.  You decide everything from how much earnest money is due, the closing date, auction date, selling as-is where-is, possession of the farm, and more! With a listing, buyers can present all of the terms and conditions and often have contingencies attached that you either have to accept, reject, or counter offer as a seller. An auction lays it all out on the table of what you are willing to accept from a bidder. You make the rules. 

Terms and conditions are extremely important and protect you as a seller. Experienced auctioneers like myself, understand what needs to be included, and how to tailor set terms and conditions to your land. 

4. What if no one bids on your auction?

It’s highly unlikely no one will bid. If for some reason you don’t agree to the highest bid on auction day, I ask my sellers to move into a 60-day listing to achieve the price you are looking for. This is why having an auction before a listing is critical. Remember how I said auction dates create bidder momentum? We now have a better understanding of how the rest of the world sees your land and who is interested.

Negotiating with Bidders

Even if no one bids, or the last bid is too low for you to accept, I now have a list of people who have expressed interest and have called with questions. It’s my job to work for you, and reach out to those who had sparked interest. I will continue to negotiate with potential buyers to reach a sold price. 

The majority of farmland I have helped sell doesn’t reach this point. Sellers often confirm the sale of their auction even before bidding ends. The farm trades hands to the highest bidder on auction day. There are secrets to how this works in your favor to achieve top prices. You can read more in my blog, “5 Secretes to Setting and Auction Reserve”. 

How Land Listings Work

What do you picture when you hear the word listing? Is it different than the word auction?

I bet you are imaging driving by a For Sale sign in the yard with a number to call or seeing a piece of land on a website with a price listed. 

1. Choose a Licensed Real Estate Land Agent

If you read, How Land Auctions Work, you should have an idea of why I recommend choosing to have an auction versus a listing. I do want to mention some of my past sellers have used a listing. I’m licensed to do so in Iowa. Be careful – some auctioneers are not licensed real estate agents and don’t have the ability to sell your land by listing! 

2. Who Buys Listings?

The buyer pool who most likely is interested in seeing listings, is investors and 1031 exchange buyers. Now this doesn’t mean they don’t bid on farmland auctions. Some investors calculate their return and cap rates based on the listing price and what they are willing to offer. 

3. Record Breaking Results!

Something to look at is what land has been selling for in the county your farm is located in. Are auctions producing the best results or listings? It’s rare you will see record breaking results from listings – they are simply set by auctions. 

4. Why it’s not a good idea to have a listing first 

Many sellers believe they can list the farm on the market for a few months to see how it does. Then switch to an auction. By listing land first, you price the farm and people will bid with that figure in mind creating undesirable results for your auction. By selling at auction first, bidders are allowed to truly discover the fair market value of your land with no preconceived notions. 

Choosing a land auctioneer or farm real estate agent 

Once you have decided the route you want to take, reach out to several auctioneers or real estate agents and get to know them. Still not sure if you should have an auction or listing? Schedule a free consultation with me! Being a land auctioneer and land real estate agent in Iowa, I can help answer any questions you have about either method. 

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5 Secrets to Setting an Auction Reserve

November 22, 2020

I understand you don’t want to give your land away, and I have a solution! A reserve land auction is where you as a seller set a minimum price where you feel comfortable selling your land to the highest bidder. You also have the right to reject or accept the highest bid unlike an absolute auction where you would have to sell regardless of the price. Reserve auctions are more traditional, and protect you as a seller! Here are a few secrets you should know when it comes to setting your auction reserve price. 

1. Talk to an Auction Professional First

“What do you think my land is worth?” Is one of the most common questions I receive when landowners call me. When you first start thinking about having a land auction, this is a great question to ask a land agent or auctioneer. I look at what the land market is doing daily, and can educate you on what I think your land is worth. If you don’t have a price already in mind, this will guide you on setting a reserve price. 

2. Reserve price = Expected Value x 75%

So, you have a good idea of what your land is worth now. The best advice I can give you next is to take 75% of the value to calculate your reserve price. 

Why not 100%? Here’s the secret. You might be feeling uneasy about your reserve price from my calculation, but this is key for bidder momentum and achieving maximum results.   

3. Announcing, “Farm will Trade Hands”

Have you ever bid on an item and wondered if you were actually going to get it? This is how bidders often feel during a reserve land auction. Farmers, investors, and other buyers understand majority of farmland is sold with a reserve. 

Your reserve price should really stay between you and your auctioneer – no one else (especially neighbors, friends, and family members) until the bids have reached your reserve price during the auction. It’s at this point I like to confirm with you as a seller that you are willing to confirm the sale of the auction and the farm will trade hands to the highest bidder. 

This creates bidder momentum. Typically, bidders will feel more relieved and react by placing more bids after you make the announcement since they know if they are the high bidder, they will get the farm which creates competition. The next few bids that are placed are how we achieve the expected value or more!

The lump in your throat feeling will slowly start to go away as you watch the next few bids be placed and continue to climb. 

4. Accepting or Rejecting the Last Bid

I want to make it clear – you have total control of your auction. Don’t worry. With a reserve auction, you have time to accept or reject the highest bid and confirm the sale even after the auction is complete. I’ve had sellers include in the terms and conditions of their auction that they have up to 4 hours or even 24 hours after the auction to accept or reject the highest bid. Although not as common as secret #3, it’s still a safe way for you to sell land stress-free. 

5. Absolute vs. Reserve

There are two different ways to sell your land by auction – absolute or reserve. I’ve talked a lot about setting an auction reserve, but I want you to be aware of how absolute auctions work. 

No matter what, if you have an absolute auction your farm will sell to the highest bidder regardless of price which can come with risks. This could be dangerous if only one bidder shows up to your land auction and there’s no competition to raise the price. 

I’m thinking worst case scenario though, and it would be very unlikely for a bidder to walk away owning farmland for $1. Remember how I said bidders appreciate knowing they can own the land if they are the high bidder in secret #3? The word absolute is powerful and similar to announcing confirming the sale of your auction. 

I would recommend having an absolute auction only in very unique situations. For example, I helped conduct an auction where all proceeds were being donated regardless of price. It was an absolute auction in October with 10 tracts of farmland that reached $11,400/acre on multiple tracts! 

Having a land auction shouldn’t be a scary or a stressful situation. I protect my sellers by letting you determine what price you are willing to sell your land for. I’m here to give you guidance and advice but at the end of the day you have to make the decision what price you are comfortable with. Let’s get started today with a free market analysis of your farm!

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