Re: Whew! Went to an auction...wot a trip!
It just keeps getting worse and worse too--more and more people with $$$ are thinking land is a good investment. It used to be that, when that nice farmer down the road retired, his son would farm the land, or he would sell it to another local farmer. Now, someone from 300 miles away comes in and buys it from a realtor so they can play absentee landlord. We're really seeing some yahoos farming now too. A couple guys out in DeKalb county just got busted for insurance fraud. It seems as though they were renting land for $300+/acre. With $2 corn, on pretty decent land (maybe 185 bu/acre), it is impossible to even break even. Well--they would fudge up a yield history on the farm claiming that it was growing 300 bu/acre corn for the past 20 years...insure it for 300 bu/acre, and then file a disaster relief claim when "only" went 185. Only question is...if they're farming it for the first year, how can they (the renter) develop a 20 year yield history on it? Hmm, the insurance companies wondered...hmmm indeed.
The other thing we're seeing is guys bidding to break exactly even. With all the competition for land, guys bid the rent to a point where they will not make a dime. They hope to break even. In a bad year, they loose $$. The idea is that, once you get "in" with a landlord, you've got the property to rent and you can renegotiate prices in a few years. Hopefully, by that time, there won't be as much competition (because half of the farmers are all going bankrupt again). Only problem is that, with the influx of urban landlords who don't watch the property or really "know" it, there is no bond built between them and the tenant. So in a few years, when the farmer wants to renegotiate, the landlord just tells his realtor to send out a bid for cash rents (and some other dumb schmuck does the same thing--bid to where he'll hopefully break even).
And as this all goes on, with landlords who rarely, if ever, see there property, a lot of guys stopped maintaining the waterways, treelines, and ditches on the farms they rent. It is a downward spiral.
Back to the topic-->I love bundles of crap. We have one good thing on a hayrack, and the auctioneer takes 10 pieces of junk and makes a "value pack" with the one good thing and the 10 pieces of junk...[img]images/icons/wink.gif[/img][img]images/icons/wink.gif[/img]