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Nebraska Land Prices Boom, But Local Farmers Say They’re Being Left Out of the Market

From a lush cornfield in the Platte River Valley to a vast swath of Sandhills pastureland, land prices are booming across Nebraska. But local farmers and ranchers say they can no longer afford to buy the farmland they want, and are being left out of the market.

According to a Flatwater Free Press analysis of sales data, the nine buyers who spent the most money on Nebraska land in the past five years are all corporate farming operations, real estate developers or investment firms from outside the state. Some, like Gates’ Mt. Edna Farms LLC, have more than 20 shell companies, all of which lead back to a P.O. box in Kirkland, Washington, where Cascade Asset Management, which manages all of the billionaire’s farm investments, is headquartered.

The trend is fueled by higher commodity prices, low interest rates on loans and concerns about inflation. “People are rushing to invest in the land,” said Jim Jansen, an agricultural economist with the University of Nebraska-Lincoln. “The opportunity to receive high cash rents, coupled with relatively low interest rates on loans, is creating demand.”

But while absentee owners like Gates can extract value from the Cash for Nebraskan land without having to live there or go to the grocery store, those same people don’t pay taxes or send their children to school in rural communities. This, experts warn, can distort local economies and rob rural communities of the tax base they need to thrive.

While many of the new cropland buyers are wealthy investors, others, like Jeff Burnett, operate small cattle and livestock operations that rely on their land to make a living. His Wyoming-based operation recently paid $20 million for nearly 28,000 acres of Nebraska ranch land in Keith and Arthur counties on the southern edge of the Sandhills. His goal is to use the land, which sits in a different weather belt than much of his existing property and thus offers some drought protection, to graze 1-year-old cattle from spring until fall.

There are many reasons that land sellers choose to sell their property for cash, including that they simply no longer have any plans for the land and want to be rid of it. Others inherited the land and decided to sell because they can’t afford to pay the property taxes, and still others are looking for a quick sale to avoid foreclosure or other legal troubles. But whatever the reason, selling to a buyer who pays cash can speed up the process of closing on a deal by eliminating the need for bank appraisals and professional home inspections. This allows the seller to close on a deal within seven to 30 days. Whether or not a buyer is buying for cash, however, the seller must be prepared to negotiate the price and terms of the sale. This can be difficult if the seller is a longtime resident of the land or has a lot of debt associated with it. In these cases, it is often best for the seller to hire a qualified broker to help with the negotiations.