Land – A Compounding Investment

In 2002, Mike Duffy, an Iowa Economist, published a report comparing Iowa land values with the stock market in term of investment power. It’s a complicated question. There really is no best answer with all the variables and assumptions that have to be made in order to try to standardize this response for everyone across the board.

These charts will show you the value of $1,000 invested in 1960, 1970 and 1970 in Iowa or the stock market. Bottom line – there are risks associated with any investment. My opinion is that land falls at the bottom of the risk scale when looking at long-term investment options. Many things change in this world. The one constant is that we only have a limited amount of land – especially land that is prime for farming and agriculture. And, because humans love to eat, it’s safe to say there will always be a demand for farm land.

Analysis by Mike Duffy, Iowa State University Economist, in 2002; Updated March 2013

Value of $1,000 Invested in 1960 in Iowa Farmland vs. the S&P

Value of $1,000 invested in 1960 in Iowa Farmland

 

Value of $1,000 Invested in 1970 in Iowa Farmland vs. the S&P

Value of $1,000 Invested in 1970 in Iowa Farmland vs. the S&P

 

Value of $1,000 Invested in 1980 in Iowa Farmland vs. the S&P

Value of $1,000 Invested in 1980 in Iowa Farmland vs. the S&P