Pasture's value greener Land: The price of Maryland's farmland per average acre rose 3 percent last year, an Agriculture Department survey says.

Agriculture

April 11, 1998|By Ted Shelsby | Ted Shelsby,SUN STAFF

Harold Lenhart's heifers graze on some of the most expensive pastureland in the country.

The price of an average acre of Maryland farmland, including the buildings, rose 3 percent last year, to $4,120, according to a U.S. Department of Agriculture survey.

This compares with a gain of 6 percent for the 48 continental states as a whole, where the average acre of farmland was valued at $1,000. Only four states -- Connecticut, Massachusetts, New Jersey and Rhode Island -- have more expensive per-acre costs.

"It's due to real estate development pressures," said Donald Hering, senior vice president of the Central Maryland Farm Credit Association, a division of the Farm Credit System, the state's largest agriculture lender. He said it is not unusual to see apartments or townhouses on the other side of a farmer's fence.

Lenhart, who runs a 100-acre dairy farm near Thurmont, sees the high farmland values as a mixed bag. "It can help you in the long run if you decide to sell," he said, "but if you want to expand your operation, it's going to cost you a lot more."

Hering said that the higher the farmland value, the more equity farmers have in their land. "This can be a big help when a farmer has to make a major capital investment. The farmer can use the equity by borrowing against it to finance the purchase of a new tractor or a combine." He said the rising equity also helps farmers keep up with the rising cost of farm equipment.

Lenhart said the increased equity was a blessing for many farmers in Central Maryland last summer when they suffered through one of the most serious droughts of the century. "They could borrow against it to help them get back on their feet," he said.

Ray Garibay, head of the Maryland Agricultural Statistics Service, said farmland values vary greatly within the state, with the most expensive being land near the urban areas of Baltimore, Washington and Annapolis.

Stephen Evelen, a real estate agent who specializes in country properties with O'Conor, Piper & Flynn-ERA in Hunt Valley, said land values vary greatly even in the metropolitan area.

"A 2-acre lot in Greenspring Valley," he said, "will run between $150,000 and $250,000. It is not much different for a 1-, 2- or 3-acre lot. The big cost is the first acre.

"In Monkton," he said, "a 1- or 2-acre lot would be anywhere from $110,000 to $150,000.

Ranked No. 1 in the USDA's survey of high-priced farmland is New Jersey, where pressures from commercial and residential real estate development have pushed up the average price to $8,370.

Other states with farmland more expensive than Maryland's were Rhode Island, $8,200; Connecticut, $7,800; and Massachusetts, $6,450.

In Pennsylvania, the average price is $2,760; Virginia, 2,100; and Delaware, $3,350.

Pub Date: 4/11/98

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