For decades, selling farmland meant finding a buyer through word of mouth, a local broker, or a private listing; now things have changed. While the traditional route still works, many landowners have started to explore faster and more competitive ways to sell.
Since 2020, rising land values, inflation, and buyer demand have shifted landowners’ perspective on how to sell farmland. That shift has led them to auctions, especially online ones.
Why? Speed, price transparency, and a defined sale date. In this article, we’re explaining exactly what that means for you and what to expect if you decide to sell your land at auction.
When and Why To Consider A Farmland Auction
In the Midwest, home of the majority of the nation’s farmland, 79% of farmland sales happen through auctions. This shift away from private listings was driven by rising land values, increased buyer competition, and an increase in online auction platforms.
Unlike private sales, which can take longer and require a lot more negotiating, auctions offer landowners faster results driven by market demand. It’s especially beneficial for landowners with high-demand parcels, a preference for a clear sale date and timeline, and who value a competitive bidding process.
So, how does the competitive bidding process work?
Let’s look at what to expect during a farm auction.
How (Online and In-Person) Farmland Auctions Work
Farmland auctions have proven to be a trusted and effective alternative to traditional sales. With faster timelines, transparent pricing, and a wider reach, they allow land owners to take full advantage of market demand. However, farm auctions aren’t the best fit for every situation. If you need full control over price negotiations or have a complex property that requires a longer sales process, private sales may offer more flexibility.
The farmland auction process has evolved dramatically in a few short years. Before the pandemic, most farm auctions took place at local community centers, county fairgrounds, and even banks. While the tradition of live auctions still takes place, online and hybrid auctions have become the new norm.
Here’s how the two options compare:
Online Auctions
- Attracts bidders from outside of your local area or state
- Increased competition, which can drive the sale price
- Offers better scheduling flexibility
- Faster sale prep and targeted marketing
- Let you track bidding activity and buyer interest in real-time
In-Person Auctions
- Focuses on local buyers
- A traditional sales experience with live interaction
- Opportunities for face-to-face negotiations
- Builds interest in an estate or community-held property
What To Expect on Auction Day
If it’s your first time selling land at auction, here’s your guide for what that process looks like from start to finish:
Step 1: Work with an experienced farmland auctioneer to select the right sale format and strategy.
Step 2: Decide on key details like reserve price, closing terms, and whether the land sells “as-is.”
Step 3: Your auction partner promotes the land to qualified buyers using digital, predictive, and local outreach.
Step 4: Buyers register in advance and review property materials like soil maps, lease terms, and title details.
Step 5: On auction day, bidders compete in person or online, and the highest qualified bids win if they meet your terms.
Step 6: The winning bidder signs the contract, submits earned money, and closes within 30-35 days.
How To Prepare Your Land For Auction
To get the most out of a farmland auction, your preparations start well before the bidding begins. Here’s what to get a head start on:
- Gather important information like title history, leases, and surveys.
- Work with a reputable auctioneer to market the land and guide your timeline
- Decide on reserve price, closing terms, and disclosure
Before finalizing anything, it’s important to see if your land has a competitive edge. A land valuation tool can help you understand land values, lease rates, and the yield potential in your area. That information is your guide to setting smart expectations and evaluating offers.
Ultimately, the right path depends on your goals, your timeline, and the local market conditions. To walk away from a farm auction with confidence, it’s important to let data guide your decisions.
Farmland Intel’s land valuation tool gives you fast access to local comps, historical yields, and more data-driven insights that help you better evaluate a land’s potential.
