Coronavirus and land auctions
What a time to be in the auction business! Well, what a time to be in any business or line of work. It's been a whirlwind of a year, and we have a feeling that its not going to be over for quite a while.
Nicole and I usually wake early and spend time talking in the morning before the children come out of their slumber. As news of Coronavirus started to become more and more serious, our conversations turned more toward our technology at DreamDirt. We reflected on our thankfulness that we decided years ago to set ourselves in a place to become pioneers of selling farmland using online land auctions.
When we first introduced the concept of online farmland auctions in the Midwest we were met with plenty of resistance and negative reactions from inside our industry. However, the public loved it immediately. Both buyers and sellers immediately recognized the innovative and stress-reducing process and the results were coming in arguably better than live in-person auctions. As our online land auctions became a more popular method of negotiating the price and sale of a farm, we've noticed that our industry has begun to follow us and adopt our innovations.
The week of March 15, 2020 the situation became particularly serious. Everything was cancelled from church to large sporting events. In many auctioneer forums on social media, there was debate with opinions running in every imaginable direction from one extreme to another. Notice after notice of cancelled auctions started to flood my newsfeeds and email. I breathed a sigh of relief because our auctions were already compliant; we have been practicing Social Distancing for years with our online land auctions. Business would continue and our clients needs would be met without interruption. In fact, social distancing was - in my opinion - one of the key components to the success we see in online land auctions because buyers are less stressed and feel more freedom to perform to their maximum ability.
Land market during covid-19
While the year has held its ups-and-downs for many, we have found that farmland sales are remaining very strong despite coronavirus. Early on the agriculture industry experienced some crazy supply chain disruptions that caused milk to be dumped and potatoes to be buried. However, looking back we see now that it was a short-term bump in the road that has since smoothed out and caused 0 effect on the land market.
COVID-19 cause our economy to contract 34% or so. Many are asking - what happens from here on out? At least in the land market, farms are still selling well. We do know that a certain number of farms are owned by businesses or business interests. We have a hunch some of that land may hit the market in the next year or so as these businesses try to free up capital. While the demand is very healthy right now, added supply to the market would be the ONLY scenario that would really affect land prices, in my opinion. And.. do I think that's a strong possibility? No, no really, not enough to make a huge difference. But it is one of the factors that I think could come about due to the coronavirus' affect on the economy.
I made a video on this exact topic:
Selling land during coronavirus pandemic
If you're ready to sell a farm, or have been thinking about it for some time, I'd like to offer a piece of advice. You can see the pattern in the land market right now. Conditions are good, and negligibly affected by the pandemic. Why would you want to wait for the mystery of what the market could bring next year or a few years from now?
Of course, we respect your right to make your own decision however you want to do it. My job is just to make your life easy and stress-free once you do make your decision. Our auctions are NO risk! Our top priority is to protect our sellers. As a company, we are on the seller's sideline. You're selling BIG assets! You shouldn't be expected to rely on hope and faith alone. We respect and provide high-quality experiences for our buyers, but at the end of the day, we protect our sellers.
99% of our clients are saying 'yes' to their auction at the end of the day due to the high quality advertising and marketing our in-house team is able to produce. We'd love the chance to talk to you to offer guidance toward the day you can say, 'Yes' too!