Is Farmland A Good Investment? 4 Factors To Consider

Farmland is one asset class that has been a favorite of billionaires for centuries and is a great way to diversify your portfolio. But is farmland a good investment?

Farmland investing has a long history of producing stable returns.

The returns are due to increasing farmland values and the profit from the cash crops.

Crops grown on farmland are sold for profit. The income produced by farmland investments can be considered similar to rental income.

Farms Produce Cash Crops

Farmland offers a unique ability to provide inflation projection without the volatility of stocks. 

While stocks are considered a monolithic asset class, performance differences are based on different environments.

Increasing Food Demand It is hard to predict the future, but I struggle to see a scenario when the demand for food decreases.

Farmers have pricing power for their crops. Food is not a discretionary item on any budget.

Everyone needs food to survive, and we all will be willing to pay any price to eat. We might cut other expenses but not food.

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