Friday, September 8, 2006 11:16 PM CDT
Farmland sells for $1.8 million
By DAVE FOPAY, Staff Writer
dfopay@jg-tc.com
CHARLESTON -- A Virginia man recently paid more than $4,000 an acre for farm land in northern Coles County, a sale amounting to $1.8 million, but still might have gotten a bargain, one area farm sale observer says.
Jesse Williams of Suffolk, Va., purchased 438 acres in Humboldt and Seven Hickory Townships from a trust. Contacted about the sale, Williams said he’s been looking for “fairly good-quality” farm land in this part of Illinois.
Williams farms in Virginia but said his operation is “an area being crowded out by development.” He said he’s “downsizing” the acres he owns there by selling parcels where roads don’t allow his equipment to access the ground, and buying land in Illinois instead.
He said he also bought a “similar amount” of land in Moultrie County and plans to lease the land to farmers here under an arrangement where they share in profits and the risk of the production. He said he’s already arranged for farmers to work the ground, but wouldn’t identify them.
Williams said he visited the area to look for land for sale and found “what appeared to be very nice communities,” but he doesn’t plan to move to Illinois. He said he still farms fulltime and his wife is a teacher.
Paul Wikoff, vice president of financial services with Farm Credit Services in Charleston, said the average per-acre price of just more than $4,100 that Williams paid isn’t unreasonable if the all the land bought is farm ground.
“He got a good deal on it,” said Wikoff, who tracks local farm land sales for the business to use in helping farmers with credit and insurance. He said there was a $5,000-per-acre sale of farm land near Oakland last winter, and the productive soil in the northern part of the county lends farm land there going for higher prices.
Four hundred thirty-eight acres is “a lot” for a single sale, Wikoff also said, as auctions usually see farm land sales of 40 to 300 acres.
“For a private sale, though, that can happen because it’s basically the whole farm,” he said.
Wikoff also said a federal law that helps people avoid paying capital gains taxes on inherited land is making large land purchases by out-of-state buyers more common. No taxes are paid on the inheritance when the land’s sold and the money’s then used to buy another piece of property of an equal value.
He said he’s heard of local spring and fall farm land auctions that have drawn several out-of-state buyers.
“Sometimes, the same guys will come back three or four years in a row,” Wikoff said.
Contact Dave Fopay at dfopay@jg-tc.com or 348-5733.
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