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Values of Land for Sale in Michigan (Updated for 2023)

Published: 09-24-21 Category: Investing

Specializes in providing actionable insights into the commercial real estate space for investors, brokers, lessors, and lessees. He covers quarterly market data reports, investment strategies, how-to guides, and top-down perspectives on market movements.

This article was updated on 8/24/23.

The uncorrelated investment nature of farmland has brought investors historically high returns over the last 20 years. Investing in farmland hedges against inflation and diversifies portfolios. In the case of the Midwest, the values of farmland for sale in Michigan have risen.

According to the 2017 Census of Agriculture, the 673,204 cover crop acres in Michigan rank the state at number eight in the nation for cover crop acreage. Michigan is home to about 10 million acres of farmland joined by over 47,000 farms and is known for its commercial production of blueberries, dry beans, cucumbers, and tart cherries; the food and agriculture industry in Michigan generates $104.7 billion in annual state economy revenue.

With the cost per acre of land for sale in Michigan continuously rising at a rate not seen in almost a decade, more Great Lake State farmers are opting for cash rents (which are lagging behind rising purchase costs) than land buys. Savvy investors looking to grow their sources of rental income and get in on the action should look into buying land for sale in Michigan in 2023.

What Is the Cost per Acre of Land for Sale in Michigan?

Throughout 2022 and into 2023, the cost of land per acre in Michigan has increased up to $5,850, higher than the current national average of about $5,050.

These increases in costs per acre of land for sale vary significantly throughout the country, with the highest real estate values concentrated in areas of the country with larger volumes of high-value crops as well as areas experiencing upward pressure due to proximity to urban areas.

Many midwestern states also experienced an increase in agricultural real estate values.

Michigan Cropland Values Also Rising

On top of the already increasing values of overall farm real estate values in Michigan, cropland values in Michigan jumped up in 2021; over 2020, cropland values increased 4.9% in 2021 up to $4,700 per acre. In dollar values, this year-over-year increase was $320 per acre, an increase not seen since 2013, according to the American Farm Bureau Federation (AFBF).

Year-over-year, the values of Michigan cropland jumped by nearly 12% in August 2023 to around $5,900 per acre, outpacing the national average as well.

Increasing demand against lower supply continues to be a primary mover behind these price changes. The Coronavirus Pandemic not only boosted awareness of the benefits of owning and working land, but it also boosted buying interest. Individual investors, alongside some farmers, are among those who caught the bug for buying land for sale in Michigan.

The 5 Best Counties to Buy Farmland for Sale in Michigan

Sustainable farming practices are increasing in popularity and usage in Michigan. When looking to buy land for sale in Michigan to use to generate profits from and related to farming, keep an eye out for cover crop acreage. Cover crops are crops that are planted to cover the soil rather than experience harvest, a sustainable farming practice used to manage soil erosion, soil fertility, soil quality, pests, diseases, weeds, and more in an eco-friendly way. This practice raises the overall quality of the farmland being purchased and increases its attractiveness to potential tenants.

Huron County: Cover crop acreage in Huron County totals about 103,000, the most in the state as of 2019.
St. Joseph County: Cover crop acres in St. Joseph County total almost 59,00.
Tuscola County: cover crop acreage in Tuscola County totals almost 48,000.
Sanilac County: Cover crop acres in Sanilac County total about 43,000.
Montcalm County: In Montcalm County, cover crop acreage totals about 30,000.

Michigan State University educator Paul Gross commented on cover crop usage on land for sale in Michigan, saying that it's contributing to rebuilding soil health in Michigan and protecting its waters. The interest in cover crop usage to keep soil healthy and effective is growing right alongside the monetary value it is giving land.

Because there were no more large influxes of government cash in 2021, market activity will provide more net farm income due to higher grain prices.

Why Buy Land for Sale in Michigan?

Aside from its rising farmland values, land for sale in Michigan poses attractive investment qualities: For one, you're very likely to find land that is close to water, providing utility access as well as opportunities for further waterside property development.

Second, the state is home to several renowned college universities that charge much lower in-state tuition than out-of-state. Buying land in Michigan for multifamily real estate development may pay off when families of Michigan State University students start looking to relocate permanently.

Finally, the economy of Michigan is on the rebound thanks to its agriculture industry, more businesses relocating to Michigan, and tax reforms.