EC Nebraska | iadirt - 2/23/2024 07:47
Coup
I agree with the premise of your argument. A couple counter points are that you have ignored capital gains taxes and that many believe that interest rates are going to come back down.
But yeah it defies logic. What other business buys an asset that returns less than 3% and borrows money to buy it at 7%?
Last fall, a couple local investors paid 12,000/acre for a pivot irrigated quarter. It's rough ground, but it's all farmable. They rented it out for somewhere north of 400/acre this spring. That's a 3% annual dividend. Land here has appreciated around 8% annually for the last 25 years.
You wouldn't buy a stock with that kind of track record?
Land ownership is an inflation hedge, and it has a heck of a lot better record than gold.
You don't think some people with money are concerned about inflation?
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Farmland ownership ROI
