How Do I Calculate a Fair Land Rental Price?
Many landowners in Paulding county choose to rent their farm ground instead of actively farming the ground themselves. The major question that landlords and tenants ask is, “What is a fair price to rent farm ground for?” Determining rental rates is dependent on a number of variables that are different for each land rental situation.
It is recommended once the landlord and tenant agree on a rental price a written lease should be signed by both parties. The North Central Farm Management Extension Committee has developed a website “Ag Lease 101” which helps both landowners and land operators learn about alternative lease arrangements and includes sample written lease agreements for several alternatives. Some of the example leases available are Cash Farm Leases, Crop-Share Leases, Pasture Leases, Farm Building/Livestock Facility Leases, Farm Machinery Leases for Non-Commercial Transactions, and Livestock Rental Leases. Ag Lease 101 can be accessed at https://aglease101.org/ Sample leases can also be accessed below.
Legal Questions & Answers
OSU Extension’s Agricultural & Resource Law Program, led by Assistant Professor Peggy Kirk Hall, helps to provide research and outreach on legal issues affecting agriculture. A variety of Law Bulletins are available from the Farm Leasing Law Library and include the following discussions: What’s in Your Farmland Lease?, Creating an Enforceable Farm Lease, Protecting, Interests in a Verbal Farm Lease Situation, Leasing Your Land for Hunting, Crop Share Leasing in Ohio, and Legal Aspects of Ohio Farmland Leases. The Agricultural & Resource Law Program can be accessed at https://farmoffice.osu.edu/
Below is a listing of resources from The Ohio State University and other land grant universities you will find useful as you evaluate a fair rent for your farm.
2011-2012 Ohio Average County Cash Rents from Ohio NASS
2011 Ohio Average County Cash Rents from Ohio NASS
2009-2010 Ohio Average County Cash Rents from Ohio NASS
2008-2009 Ohio Average Rental from Ohio NASS
Flexible Cash Lease Calculator - Options for Cash Lease with a Bonus Approach, Net Return Approach & Ratio Approach
Crop Share Calculator- The Crop-Share Lease Calculator is a tool designed to allow the user to input costs and shares of each to fairly allocate revenue in a crop share lease arrangement.
Custom Rate Calculator- The Custom Rate Calculator calculates a more accurate portrayal of the current Custom Rates based on the increase in fuel prices.
Machinery Rental Rates Calculator- The Machinery Rental Rates Calculator takes user input to determine the recommended rate for renting material.
Land Bid- A calculation of the maximum amount that can be paid for farmland, while still having a profitable investment