MANKATO — A county assessor, when valuations on any type of property soar by 44 percent in a single year, would typically expect to get an earful from irate property owners worried about the impact the valuations will have on their next round of real estate taxes.
Blue Earth County Assessor Michael Stalberger, however, has heard virtually nothing from county farm owners about the 44 percent jump in ag land values for taxes payable in 2014.
“That market is just really hot right now, and folks who own that land know that,” Stalberger said.
Blue Earth County farmland, which carries an average value of $5,600 an acre this year, will see that average rise to $8,000 when property taxes are paid next year.
Assessors are required by state law to assess property at market value, and so the valuations are based largely on actual sales of similar land. Farmers understand that and aren’t blaming the messenger.
In four recent township meetings where property owners could have disputed valuations, only two people challenged the conclusions of the county’s appraisers and neither involved ag land.
“Farmers, they’re all very tuned into the market,” Stalberger said. “They hear what land is selling for, hear about the auctions out there.”
Of course, what’s bad news at tax time is pretty good news in a more general sense: Farm owners have something that people want and are increasingly willing to pay a premium for. The 44 percent valuation gain follows increases of 19 percent and 10.5 percent in previous years.
Kevin Paap, who farms near Garden City, said the rising value of farm land is related in part to the strong earnings produced by the land the past several years when commodity prices were high. But it also reflects a growing interest by outside investors to get a piece of that agricultural income at a time of low rates of return on other types of investments.