Farmland Use Values Versus Market Prices in Three Oregon Land Markets

Analysis of 339 farmland sales in three areas of Oregon during 1965-69 showed that in each area, factors in addition to net rent income influenced prices paid. Corresponding property characteristics also varied in importance among areas in explaining differences in per acre prices paid. Values of six property characteristics were obtained for each sale—year of sale, acres in sale, building value per acre, miles to nearest paved road, miles to nearest town of at least 1,000 population, and landlord net real estate income per acre. Based on significant differences in the importance of property characteristics on prices paid and the apparent differences in motives for transactions among these areas, it was concluded that each area constituted a separate land market. Net rent-to-land price ratios varied from 4.3 percent in the dryland grain area to 2.8 percent in urban influenced Marion County to 1.0 percent in urban recreation influenced Douglas County. But because of the variability of rent-price ratios for individual properties within each area, a disparity between the farm use value and market price of farmland was concluded to exist only in Douglas County