When considering whether to rent or buy farmland, U.S. farmers face a complex decision that impacts their financial stability and operational flexibility. According to the United States Department of Agriculture, approximately 39% of the 911 million acres of farmland in the contiguous United States is rented. The proportion is higher for cropland—54% as of 2022—particularly for cash grains like rice, corn, soybeans, and wheat.
Renting farmland offers several advantages. Farmers can avoid large upfront investments and use available capital for other needs such as equipment or operational expenses. Renting also provides flexibility to expand, downsize, or experiment with new crops without long-term commitments. New farmers may benefit from established infrastructure and mentorship opportunities with experienced landlords. Additionally, rent payments are tax deductible.
However, renting has drawbacks. Renters have limited control over property modifications and may find it difficult to invest in long-term improvements like soil health due to short-term leases. There is also the risk of rent increases or losing access if a landlord decides to sell or accept a higher offer from another tenant.
Buying farmland brings its own set of benefits. Owners gain stability in land costs and complete control over property decisions and improvements. Ownership allows for long-term investment in the land’s productivity and can help build a legacy by passing the farm on to future generations. Property taxes and interest on loans related to land purchases are also tax deductible.
The challenges of ownership include significant upfront capital requirements, unexpected property issues such as zoning disputes or water resource challenges, and risks from natural disasters or market fluctuations.
Farmers Business Network (FBN), founded in 2014 by Charles Baron and Amol Deshpande according to its official website, provides resources for those navigating these choices. FBN seeks to enhance farming by offering greater access to information, analytics, and competitive options for producers. The organization operates an online marketplace with transparent pricing and direct delivery to farms, helping members make data-informed decisions about seed selection, pest management, and more through free tools.
Diego Casanello serves as chief executive officer at FBN according to company information. The network functions as an agricultural platform focused on improving farmers’ access to markets and insights from its headquarters in San Carlos, California.
For those considering buying land, FBN Finance offers loan pre-qualification services so buyers can secure financing before making an offer. For renters, operating lines ranging from $150,000 to $1 million are available for covering rental payments as well as input expenses and equipment costs.
FBN Finance advisors average more than 15 years’ experience in agricultural finance and provide guidance throughout the loan process.
