SANTA BARBARA, Calif. -- Prices for farmland are growing in California. Experts are saying the farmland is a hot commodity. Since 2010 there has been a substantial number of sales that have come through Santa Barbara and Monterey County.
Appraiser Todd Murphy said prices will vary generally due to its location, climate and water supply but the land isn't being bought by new investors, in most cases growers are buying new properties to expand their business. "Enough sales have occurred in 2011, 2012 that have indicated to me that farming is still profitable and that people are confident in buying the land," said Murphy.
Both Santa Barbara and San Luis Obispo counties have similar traits, and both are seeing the price for strawberry and vegetable farmland slightly increase. "People will pursue that type of operation that is most profitable," said Murphy.
In Santa Cruz and Monterey, prices are also staying strong. Investors are not only snagging up vineyard land but irrigated crop land and vineyards, something the entire Central Coast has in common, is something investors are highly interested in. "The quality of the wine produced in the Central Coast is reflected in the price people feel justified in paying for in either land to plant vineyards or actual vineyards themselves."
Some of the highest priced farmland in the area is in the Santa Maria Valley and into Guadeloupe, at times selling for $60,000 an acre. "It has very high quality soil and it tends to be a lot closer to various infrastructure such as labor and various packing facilities," said Murphy.