Best Regions for Agricultural Land Investment
- Craig Kaiser
- Jul 22
- 6 min read
Investing in agricultural land offers a blend of stability and growth that appeals to a wide range of investors. Unlike more volatile markets, agricultural investments often provide steady returns over time, thanks to their essential role in the global food supply. But not all farmland is created equal. The right region can make all the difference when it comes to maximizing returns and reducing risks. Below, we explore some of the best regions for agricultural land investment, touching on soil quality, climate suitability, water availability, and market access. We’ll also examine potential risks and provide practical advice for evaluating your options.
What Makes a Region Good for Agricultural Investment?
Agricultural success relies on a combination of environmental, economic, and legal factors. Successful investors go beyond the surface-level appeal of a region and evaluate it based on several critical criteria. First, fertile soil is a key factor that makes a region suitable for farming and agricultural land investment. High-quality soil leads to better crop yields and reduces the need for costly interventions such as fertilizers, making agricultural operations more efficient and sustainable. Similarly, access to water is another essential component. Reliable water sources are crucial for both rain-fed and irrigated agriculture, ensuring that crops can thrive regardless of fluctuating weather conditions.
Climate suitability is a critical factor in the success of farmland investments. Stable weather conditions, adequate rainfall, or reliable irrigation systems are essential for consistent crop production and reducing the risk of failures. Another key consideration is market access. Proximity to transportation hubs and demand centers lowers logistics costs, enhances efficiency, and increases profitability. Additionally, political and legal frameworks play a pivotal role in agricultural ventures. Supportive policies, robust land ownership laws, and political stability mitigate risks and provide a secure environment for investors.
Top Regions for Agricultural Land Investment
The top 3 U.S. regions that are best for investing in agricultural land are the Midwest, the West, and the Southeast.
1) The Midwest, U.S.
The U.S. Midwest, often referred to as the "Corn Belt," is a powerhouse of agricultural production. The Midwest is often known as the best region for agricultural land investment. The States like Iowa, Illinois, and Indiana are known for their fertile soil, perfect for high-yield crops such as corn and soybeans. A state that stands out for agricultural land investment is Iowa- according to the USDA, Iowa is the state with the most fertile soil in the U.S.
Why It’s Attractive:
Highly fertile soils, particularly mollisols.
Advanced farming technologies and infrastructure.
Strong market access due to established transportation networks.
Crops That Thrive: Corn, soybeans, wheat, and alfalfa.
Potential Challenges: The value of agricultural land in the Midwest tends to be higher. The region also experiences increasing pressures from climate change, including more frequent droughts and floods.
The Midwest is also known as one of the best places to start a farm. States such as Montana, Idaho, and North Dakota are often highlighted as top options, thanks to their affordable land, fertile soil, and robust agricultural economies.
2) The West U.S.
The Western region of the U.S. offers great farming opportunities with its warm climate, long growing seasons, and irrigation systems to offset arid conditions. Crops like chili peppers, cotton, pecans, and citrus thrive in the southwest U.S. to ample sunshine and adaptable practices.
Why It’s Attractive:
The Western region of the U.S. employs the heaviest irrigation of any region.
Extended warm growing seasons with minimal risk of frost or severe storms.
Organic, ethnic, and drought-tolerant crops perform well and are in demand.
Crops That Thrive: Cotton, fruits, alfalfa, nuts, fruits
Potential Challenges: Low natural rainfall and recurring droughts have led to an over-reliance on irrigation (e.g., Colorado River, aquifers) that are already under stress. The extreme heat in some areas limits crop choices during peak summer months.
States like California and New Mexico stand out as a great location for agricultural land investment in the Western region of the U.S. in particular. New Mexico offers some of the most affordable farmland in the U.S., along with a rich agricultural history and innovative water management, making it a promising choice for farming investments. Similarly, California is ideal for agriculture and one of the world's most productive agricultural regions in the U.S. thanks to its diverse climates, rich soil, and advanced irrigation systems. Its Mediterranean climate, with warm summers and mild, wet winters, supports a long growing season and a wide range of crops.
3) The Southeast U.S.
Third on our list of top regions to invest in farmland is the southern U.S. The southeastern United States is home to vast agricultural resources, thanks to its long growing season, plentiful sunlight, fertile soils, and abundant water supply. The region produces a variety of key crops, including broilers, cotton, and peanuts, with Florida ranking as the nation’s top peanut producer. While corporate farming has expanded in recent years, family-owned farms remain prevalent, especially in states like Tennessee.
Why It’s Attractive:
Extended growing seasons, abundant sunshine, and ample rainfall complemented by reliable groundwater for irrigation.
Strong agricultural economy and infrastructure
The region is home to fertile soils, especially in the coastal plains and piedmont areas, making it ideal for agriculture.
Crops That Thrive: Broilers, peaches, pecans, corn, soybeans, peanuts, fruits
Potential Challenges: The Southeast faces frequent extreme weather events, including hurricanes and floods, which pose significant risks to crops and livestock. The combination of intense rainfall and rolling terrain makes certain soil types highly vulnerable to erosion and nutrient depletion. As a result, effective soil management practices are essential to mitigate these challenges and protect agricultural productivity.
The Southeast is home to diverse agricultural markets, each with unique challenges and opportunities. In Florida, the sector has largely recovered from the latest hurricane, though the decline of fresh-market citrus remains a challenge. However, factors like development opportunities, retirement transitions, and lifestyle-focused farming have helped boost income in the region. Meanwhile, Georgia and the Carolinas are regaining appeal for agricultural investments, offering crop diversity, consolidation opportunities, and a recent rebound in returns after years of below-average performance.
Tips for Evaluating Agricultural Land Opportunities
Before buying agricultural land, be sure to crunch the numbers and figure out how much you can afford to pay. Many land investors ask how much money is needed to purchase agricultural land, but the answer depends on how much you can afford and several land-specific factors, like the property's location and its historical crop production. You can expect to pay between $500 to a few thousand dollars per acre for farmland. Typically, lenders require a 15-20% down payment for high-quality farmland, while lower-quality land may demand an even higher percentage. However, certain programs designed for beginning farmers offer the opportunity to secure farmland with a down payment as low as 5%.
After you have chosen a location to purchase agricultural land in, start by conducting thorough research into the region’s soil profile, climate data, and water resources before making a purchase. Due diligence is crucial in ensuring a successful investment- taking proactive steps can help mitigate risks and ensure a successful investment in farmland.
LandApp Pro is a tool that can help you conduct due diligence for land purchases. With nationwide soil data, topography data, land usage information, and 40 more data layers appended to over 150 million parcels nationwide, you can assess land suitability for farming and agriculture at a glance. Additionally, you can use LandApp Pro's proprietary value and risk index scores to identify additional revenue opportunities and evaluate natural and man-made risks at a glance:
Assessing infrastructure is another key factor to consider when evaluating agricultural land opportunities- consider the proximity to markets, transportation networks, and storage facilities. Working with experts such as local consultants, agronomists, and management firms can help with this to set your investment up for success. These experts can also assist with understanding zoning laws and verifying land titles and ownership rights.
How to Buy Agricultural Land
Agricultural land investment is a long-term endeavor that requires careful planning and research. Generally, agricultural land is considered a good investment, but investors must also weigh risks, from environmental challenges to legal uncertainties. By approaching these opportunities strategically and leveraging expert knowledge, you can position yourself for both financial and sustainable success in the agriculture sector.
If you're searching for agricultural land for sale in the U.S. or agricultural land for sale near you, check out LandApp's nationwide marketplace! Find farmland for sale, horse properties for sale, irrigated farmland for sale and more. Filter by location, price, and more to find your perfect farmland investment: