Is Renting Farmland Smarter Than Buying?

Plenty of people would love to break into farming, but beginners’ number-one barrier is access to land. With so much farmland already claimed—by older farmers but also increasingly by investors, corporations, and developers—desirable acreage is hard to come by. Plus, the price of farmland in the U.S. is sky-high.
Nationwide, farm real estate value, which includes all land and buildings, averaged $3,380 per acre in 2021, up 7% from 2020. More specifically, cropland value averaged $4,420 per acre, a 7.8% increase, while pasture value jumped 5.7% to reach $1,480 per acre.
In Wisconsin, the price is even higher. Last year, the average farm real estate value hit $5,190 per acre, with cropland costing $5,280 and pastureland running $2,520 per acre.
Many would-be farmers just don’t have that kind of cash, and it can be tough to secure financing for a multimillion-dollar land purchase. So, unless they have farmland in the family, their dreams of owning a farm may be dashed.
But that doesn’t mean they can’t become farmers. Renting land can be a viable alternative to buying it, especially for beginners, who may not be credit-worthy and who still have a lot to learn about agriculture. Of the 911 million acres of farmland in the contiguous U.S., approximately 39% is rented.
Of course, there are drawbacks to renting. The obvious big one is a farmer doesn’t own their land, which also might limit what they can do with it. Additionally, whereas owning land provides long-term security, leases may be short-term, leaving a farmer’s future in question. Renting also doesn’t let them build equity in land, a key perk of ownership.
But renting has many upsides too. It’s significantly cheaper than buying, which frees up money to purchase equipment, animals, crop inputs, and other infrastructure. Plus, renting gives beginning farmers more latitude to learn, make mistakes, and make sure they want to farm after all. And if they rent from a retiring farmer or farm-based organization, they might score mentorship, connections, or established customers.
Recognizing the barriers to land access and security, various nonprofits, land trusts, government programs, and other organizations are stepping up to help. For instance, Iroquois Valley Farmland REIT, featured at Edible-Alpha® Live!, provides long-term leases and mortgages to organic and regenerative farmers. Similarly, Yggdrasil Land Foundation leases land affordably to young farmers focused on organic, biodynamic, regenerative, and community-focused agriculture.
A 30-year contract with Yggdrasil is the reason Chaz and Megan Self are able to pursue their dream of farming. Having no family land or agricultural experience, the Grassway Organics founders would’ve had a hard time building their business without this arrangement, which Chaz calls “a dream.”
“It allows us to pay rent and not carry a massive debt load for buying land,” he explains in Edible-Alpha® podcast #114.“Most farmers are cash poor and equity rich, but we are kind of the opposite. We’re not rich, but we’re cashflow strong and equity poor.” With affordable rent, Chaz adds, they can pay themselves, save up money, and build equity in other places, such as their herd of Jersey cows.
While renting may not be the best solution for every farmer, it’s definitely a model worth exploring.

Chaz Self didn’t set foot on a farm until age 19, but that didn’t stop him and wife Megan from pursuing their dream owning a sustainable, organic, diversified ag business. With a 30-year lease on nearly 600 acres, the Selfs have grown Grassway Organics into a successful grass-based dairy and meat operation and thriving agritourism enterprise. Hear Chaz share their ups, downs, and lessons learned in this compelling episode.

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