There was another farm auction today at the Elk's Lodge where LuAnn and I bought our last farm in November. It was an interesting study of people, farmers, economy and socioeconomics. I believe that is the word I am looking for but there was a lot of group dynamics involved, too.
It's a nice 106 acre farm 5 miles from us or so near Cuba on old US 68 or Cuba Pike. It's been one family a long time. The old house even has the old German wood floors those farmers were famous for.
Someone I know put in a bid for $4000. It went to $4300 per acre and stopped. The auctioneer started into his closing chant but we all knew it should bring more than that. The woman next to me was from Cincinnati and I had just met her and her husband. I had just told her about the one near me that brought $6,000 an acre. She asked me if $4400 was too much and I said no. I was sure it would bring between $5-6000 per acre. She raised her hand and that broke the ice.
The bidding took off to $5,000 per acre quickly and at about $5200 it stopped again. This time the auctioneer said I would take a $50 bid on this fine spring day and the bidding took off again. I couldn't see who was bidding but it was coming from the big group of farmers in the back of the room. I spotted an old friend who bid and kissed his wife. The auction was slow at this time but kept moving. The auctioneer got down to $25 per acre bids but confused himself by saying "I have fifty two two fifty" instead of saying $5225. The bids kept creeping up slowly and finally he got to $5775 per acre and asked for $5800. The older farmer finally bid that before the sale ended and that stopped the other bidder, whoever that was.
The farm sold for $5800 per acre or just under $620,000 total. He had to write a check for about $62,000 or ten percent of the purchase price. The lady I referred to made the auctioneers day when her husband asked what the bidders premium was and the auctioneer said there was none. "Most of these people think I am overpaid anyway," was his response.
Land in economically depressed southern Ohio has crept higher, still half that of neighboring states. I had wondered if the 50 cent drop in market price this week would deter anyone and when the bidding died at $4300 I thought maybe it had.
After $5800 per acre, I would say not. My old friend got a good farm for a high price around here but half what neighboring states bring.
Ed
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