WHITE PIGEON, Mich. — A 190-acre farm in southwestern Michigan recently sold for $1.4 million at auction.

Schrader Real Estate and Auction Co. marketed the property and managed the sale of the land, which was described as “prime, level, productive farmland” in sale materials. According to Schrader’s Michigan Office Manager Ed Boyer, the sale marked one of the highest per-acre sales for the auction company during his tenure. He has been with the company since 1986.

“There’s very little land available in that area, and there hasn’t been much on the market,” Boyer said. “The landlords have been receiving such high rent that to them, it makes more sense to keep their land than to sell it.”

He said the trend his company is experiencing is that selling land at public auction “creates competition. There were still six bidders, at $8,000 per acre. Usually it gets to about $6,000 per acre, and it drops to two or three bidders.”

Most of the tillable farmland was contained in a single tract of 97 acres, which sold to an investor for $860,000, or $8,865 per acre. It was dry land and did not include any irrigation.

“Until now, we have not seen any dry land at that price,” Boyer said.

“This reminds me that there’s no substitution for letting people compete for the property in an auction, especially in a vibrant market like this one,” said R.D. Schrader, president of the company. “The significant thing to me is that even when bidding on the tract reached the $7,000 per-acre level, we still had several bidders actively competing for the land. It is very easy to underestimate the current value of farmland in the Midwest.”

According to Boyer, the buyer is an investor who is renting the land to a local farmer for agricultural production. Irrigation is being installed on the property.

He said he believes some of the pressure for farmland in the area is compounded by the fact the area is home to two corn seed companies – Monsanto and Pioneer – as well as several large crop farmers and some potato producers.

“Right now it works to pay that kind of money,” Boyer said. He also said rising land prices are making it a challenging for sellers to get accurate appraisals on their property.

“We’re having such a hard time trying to appraise land,” he said. “Trends have been up on farmland very consistently. We are going into our 24th year here, and we have seen the trends steadily go up for 24 years.”

The remaining 93 acres, which sold to a different bidder for $550,000, included a country home, approximately 1,300 feet of frontage on the White Pigeon River, approximately 9.6 acres of tillable land and wooded acreage.

Schrader Real Estate and Auction Co. is based in Columbia City, Ind. It was established in 1944 and reaches into more than 40 states, marketing large holdings of farms, ranches and timberland, as well as commercial and industrial portfolios. The sale was managed by Ed and Ted Boyer, in Schrader’s Michigan office.