LUBBOCK, TX – Farmland values held mostly steady or edged higher nationwide in 2025, underscoring how closely land markets remain tied to farm finances and lending stability. A new report to the Farm Credit Administration board highlights land as a key driver of borrower balance sheets and credit risk.
Real estate loans account for more than 40 percent of the Farm Credit System portfolio, meaning shifts in land values directly affect lenders and producers. Regulators also approved a proposed rule that updates how administrative assessments are divided among System institutions, without changing the overall amount.
Operationally, limited land supply, government support, and strong livestock margins supported values, while higher interest rates and weak commodity prices put pressure on some areas.
Regionally, the Midwest posted modest gains, led by Iowa, late in 2025, while the Delta remained stable, with potential downside if stressed producers sell land. Texas values rose on strong demand, and Western markets showed mixed trends tied to water constraints and crop profitability. Northeast and Southeast values also increased amid tight supply.
Looking ahead, regulators say higher borrowing costs and weaker commodity returns could soften land markets in parts of the country during 2026.
Farm-Level Takeaway: Land values remain key to borrowing strength.