Summer used to be the “slow” season for Halderman but for the last five years that’s steadily transitioned to only quarter two. It’s not necessarily a sign of the times, it’s just how things are evolving.

“We sold more farms in the third quarter every year for the past five years; I don’t know what that means, but it hasn’t impacted land values,” Karst said. “Purdue University reported slightly elevated land prices from June 2023 to June 2024. All of that increase is coming between last June and December.” The survey shows a decrease from December 2023 to June 2024.

The increase in land value is interesting, especially when compared to the sharp drop in predicted farm income in 2024 and 2025.

Bumper Crop, Bummer Price

Last fall, corn and soybean prices dropped significantly and have yet to recover. It’s still anyone’s guess if they will recover even as the 2024 crop is harvested. For many of Halderman’s customers, yield monitors are setting off fireworks as their yield numbers climb.

“It’s fun to watch those yield monitors put out those big numbers, but the crop isn’t worth as much as it was a year ago,” Karst said. “I think many farmers will be in good moods this quarter, and we’ll see how that holds out as they start doing taxes and renewing operating loans in the spring.”

Compared to 2023, farmer earnings are expected to be reduced by a whopping 44 percent in 2025, according to USDA predictions. This is a direct result of the lower corn and soybean prices.

Prices in September (USDA NAAS) Corn Beans

2020 $3.41 $9.24

2021 $5.47 $12.20

2022 $7.09 $14.20

2023 $5.21 $13.20

2024 $4.24 (July) $11.80 (July)

“There are two types of demand, effective and potential,” Karst explained. “Effective demand means you can afford the item you want to buy or borrow money. When you lower earnings, you don’t lower demand directly you lower effective demand because income drives that. Repayment capacity drives all investments.”

Despite those numbers, everything is business for Halderman and Karst, who are also in the field this fall. Like last quarter, easy-to-access, squared-off field-type farms (“good farms”) sell at or above average prices. In contrast, farms with less desirable traits find it challenging to meet seller expectations.

“Land buyers, both farmers and investors, are going to be choosier about what they buy; they want to make sure it’s a good fit in their program and match well with what they already own,” Karst said. “We’re calling the land market steady to down five percent. The decline mostly comes from below-average farms in less competitive areas.”

Fall Agenda

Learning from past mistakes, mostly occurring in the 80s, Karst doesn’t believe there’s ever a time to panic sell farm ground based on the political or financial climate. There are always extreme cases with no other options, but that’s not the average scenario.

“It’s always smart to make long-term decisions with long-term money rather than short-term money,” Karst said. “If corn skyrockets this winter and hits six or seven dollars again, should you make a long-term decision based on that short-term windfall?”

Knowing that their income will be diminished this year regardless of the bumper crop, a handful of farmers are choosing to sell off 80 to 120-acre parcels this fall. It’s still early in the sale season, but this could quickly become a trend. It might be a smart way to prepare for a skinny year as far as cash flow goes in 2025.
“Working capital evaporated this year for the average farmer; instead of borrowing more money for working capital or placing a mortgage on a property to transfer that short-term debt to long-term, they’re selling a small part of their portfolio,” Karst said. “By doing this, farmers are reducing their payments, so their cash flow is more favorable moving forward.”
Of course, the looming election is at the top of many’s minds, but it’s not something to panic about. Raising the capital gains tax threshold has been a point of discussion for Kamala Harris, but it’ll take an act of Congress to gain any steam.
“Obama promised a huge capital gains tax bump, and many people panicked and sold their farms before he took office because they were worried the tax would double,” Karst said. “As far as we know, nobody is selling their farms because of the election.”

The changes coming for estate taxes in January 2026 are worth paying attention to now. The federal exemption will reset to previous levels. It won’t take a vast operation to reach that number, which means you will likely have some work to do on estate planning next year.
“Landowners, specifically farmers, need to be looking at their estate plans and make sure everything is in place so they can protect as many assets as possible from those estate taxes,” Karst said. “My advice is to contact your estate planning specialist and don’t wait until the last minute to get those plans worked out.”

For more detailed advice on estate planning, visit this previous Halderman blog post.