AMM Land Sales (815) 384-6153

Land types

Sell agricultural land.

Cropland, pasture, and ground currently farmed by someone else. A tenant in place does not stop a sale, but it does change the timing and the price, and you should know how before you list it anywhere.

A lease travels with the land

If a tenant is farming your ground, the lease generally survives the sale, and in most states an oral year-to-year farm lease is enforceable. That matters for timing: many states require notice to terminate a farm tenancy months before the lease year ends — Iowa requires it by 1 September, Illinois by 4 November for a year ending in February. Miss the window and the buyer inherits another full crop year. We ask about the lease early because it moves the closing date more often than title does.

Tax deferral can create a bill at sale

Most states assess farmland on its agricultural use value rather than market value, which keeps the annual bill low. Many of those programs claw back the difference when the land converts to non-agricultural use — often three to ten years of deferred tax, sometimes with interest. Selling to another farming operation usually does not trigger it. Selling to a developer usually does. Who the eventual buyer is can therefore change what the parcel nets you.

Soil rating drives the number more than acreage does

Two adjoining 80-acre fields can differ by a third in price on soil alone. Buyers price against productivity indices — CSR2 in Iowa, PI in Illinois, NCCPI nationally — because those predict yield, and yield predicts cash rent. Tillable percentage matters as much: eighty acres with sixty tillable and twenty in timber and waterway is not an eighty-acre farm, and pricing it as one is the most common mistake we see on listings.

Drainage and water are part of the asset

Installed tile, a functioning outlet, and an irrigation permit are real value, and their absence is a real discount. In much of the West a water right is a separate property interest that can be severed from the land — a quarter section with an appurtenant, seasoned water right and the same quarter without one are different assets entirely. If you hold water rights, tell us, because they are frequently missed and just as frequently the largest single item in the valuation.

CRP and other enrollments

Ground enrolled in CRP carries a contract with remaining term and annual payments. A buyer can usually accept transfer of the contract, and the payment stream has value — but early termination triggers repayment of prior payments with interest. We treat the remaining term as part of the price rather than an obstacle.

Valuation

What moves the number

What moves the number on farm ground, roughly in the order it matters.

Factor Effect on value
Tillable acres and soil productivity index The largest single driver. Untillable acres are priced as recreation, not as farm.
Cash rent in the immediate area Sets a floor. Buyers capitalize local rent to arrive at a per-acre figure.
Drainage and tile Installed tile with a working outlet adds meaningfully; wet ground without it discounts.
Water rights, where applicable Can exceed the value of the dirt in irrigated regions. Verify seniority and seasoning.
Lease status and termination window Affects when a buyer takes possession, and therefore what they will pay now.
Deferred-tax exposure Potential recapture on conversion. Discounts the parcel for non-farm buyers.
Field shape, access, and road frontage Odd shapes and point rows raise operating cost and reduce what an operator will pay.

Questions

Selling agricultural land

Can I sell farmland that has a tenant on it?

Yes, and the sale does not require the tenant to leave. The lease generally transfers with the land, so the buyer steps into your position as landlord. What matters is the termination notice deadline in your state, because it determines whether the buyer gets possession this year or next — and that difference is usually reflected in the price.

Will selling trigger back taxes from an agricultural exemption?

Only if the use changes, in most states. Agricultural-use assessment programs generally recapture deferred tax when the land converts to a non-agricultural use, not simply because ownership changed. A sale to another farming operation typically continues the enrollment. Because we may resell to a non-farm buyer, we look at recapture exposure as part of pricing and will tell you what we found.

Do you buy farmland with a CRP contract still running?

Yes. The remaining contract term and payment stream are part of what we are buying, not a problem to be solved. Contracts are generally transferable to a new owner who agrees to the terms, and we would rather assume the contract than trigger early termination, which requires repaying prior payments with interest.

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