Both economists note that the amount of land for sale in 2009 and 2010 fell dramatically from 2008’s relatively active market. The trend is expected to continue into 2011. Meanwhile, outside investors have been showing more interest in buying farmland. The relative stability of farmland investment returns compared to returns from other investments is responsible for both trends, the economists say.

“With poorer returns for other investments, farmland is more attractive,” notes Duffy, who published a study in 2009 comparing farmland and stock market returns. The study showed that an Iowa farmland investment would have returned 4.68% per year from 1960 to 2009 — compared to a 3.2% annual return to S & P 500 stocks.

Many potential farmland sellers have concluded that farmland is the best investment for now. “If an individual has an option of selling now or waiting, they wait,” Schnitkey notes. “If you sold the farmland, where else would you invest the money?”