Poor Cell Reception Could Impact Land Value: Report
By: Kelvin Heppner
June 7, 2016
Yield history, soil type, fertility, drainage, irrigation potential, and cropping options — those have traditionally been some of the main factors considered when assessing the value or rental rate for a parcel of farmland. But with telematics and data collection capabilities of farm equipment expanding rapidly, there’s another field characteristic that should probably be considered: wireless internet access.
“Farmers who expect to utilize telematics may not be willing to pay similar rental rates for farmland tracts without adequate wireless connectivity,” says a report published by Terry Griffin of Kansas State University and seven other U.S. agricultural academics in the 2016 Journal of American Society of Farm Managers and Rural Appraisers.
All else being equal, a piece of land with a good data connection will be (maybe already is) more valuable than a field in a location without internet access.
“Although the gaps in wireless broadband connectivity are likely to decline with technological improvements, it is expected that farmland values may be affected by connectivity lags until that time,” says the paper, which delves into some of the rural property value implications from the shift toward “big data” in agriculture.
Providing historical geospatial data and other grid map information, not just historical yield averages and soil test information, could be worth a premium in the short-term. In the longer term, the authors suggest there will be a penalty when land is sold without this data. A poor connection only makes it more difficult to accumulate this data.
It’s an interesting consideration, both from an individual farm business perspective and from a larger policy angle. Many farms already have cell-phone boosters on yards. Will we see increased investment in private infrastructure to achieve the adequate wireless connectivity? There’s been plenty of discussion about whether government or telecom companies have a public role in providing cell service in rural areas. Has the potential impact on property values been considered in these discussions?
Next time you’re looking at a new piece of land, it probably pays to not just use your phone to take photos of how the water runs off the field or other physical attributes. The number of bars in the top right corner of the screen might be significant too.