US purchase of farms
Migration Program Details & Application
Program Overview
Buying American farms
Project Description
I. Core Positioning of the US Farm Market
The macro-level characteristics of the US farm market are "huge asset size, extremely high landlord-shareholder ratio, and long-term steady increase in land value." The average value of farmland nationwide in 2025 is $4,350 per acre (1 TP4T), an increase of $4.31 per acre (1.91 per acre after inflation adjustment) from 2024. In the near-term performance for 2025, arable land nationwide increased by $2.21 per acre after inflation adjustment, averaging $5,830 per acre (1 TP4T), while ranch land averaged $1,920 per acre (1 TP4T). Net farm income in the US is projected to reach approximately $180 billion per acre (1 TP4T) in 2025, an increase of approximately $291 per acre year-on-year.
Foreign buyers held approximately $45.2 billion in U.S. agricultural land between 2019 and 2023 (about 2.41 TP3T of all privately and foreign-owned agricultural land). Despite the relatively small historical data, foreign investment in agricultural land has been elevated to a national security level, and several bills for fiscal years 2025-2026 are pushing forward with measures to strengthen reporting and vetting requirements for foreign investors.
Special Note: At the federal level, AFIDA requires foreign buyers to report their agricultural land interests to the U.S. Department of Agriculture, but this does not automatically prohibit purchases. To date, there is no federal law in the U.S. uniformly limiting the amount or total area of agricultural land owned by foreign citizens. However, more than 24 states have enacted stricter laws restricting the purchase of agricultural land by specific foreign entities (especially entities from “hostile states”), and some state bans may directly prohibit foreigners from specific countries from purchasing farmland. Before purchasing, it is essential to clarify which state the farmland belongs to and assess whether state laws explicitly prohibit or require reporting by foreign buyers.
II. Price Range and State-Level Differences
The price of agricultural land in the United States is extremely uneven, depending on soil quality grade, irrigation capacity, urban or rural location, and other sources of income (carbon sinks, wind and solar leasing, etc.).
Regional/State Farmland/Pastoral/Mixed Price Range (per acre) Notes
Corn Belt / Midwest (Iowa, Illinois, Indiana, Minnesota): High-quality irrigated farmland, 1 TP 4T 8,300–1 TP 4T 13,000+. One of the most densely populated areas of farmland value in the United States.
Iowa (benchmark farm): Mixed crop + pasture: 1 TP 4 T 8,299/ac (down 1 TP 4 T 252 from peak). Projected to decline by 1.81 TP 3 T in 2025; demand is decreasing but prices remain in high range.
Nebraska farmland + ranch average price $3,905/ac (down 1%). Livestock sector supports ranch prices, but crop yields decreased by 16%.
South Dakota ranches + farmland saw a year-on-year increase of 7.91 TP3T, while ranches saw an increase of 12.81 TP3T, driven by strong demand from the livestock industry.
Wyoming ranches saw an 8.71 Tb3T increase in value over one year, driven by land scarcity and the premium associated with outdoor lifestyles.
In California's Central Valley, irrigated farmland accounts for 9,830+ TP4T/acre ($/acre = 2,450 acre of pasture). High-profit crops such as almonds, grapes, and tomatoes are being grown, with the pasture-to-farmland ratio expected to quadruple by 2025.
Western semi-arid region (New Mexico and parts of Texas): Irrigated/non-irrigated pastures, 1 TP 4 T 1,500–1 TP 4 T 4,000. Relying on livestock and limited crops, land prices are moderate.
Central Great Plains (Kansas, Oklahoma) Winter wheat/pasture: 1 TP 4 T 2,000 – 1 TP 4 T 6,000 (Varying)
Southeastern (Georgia, Alabama, etc.) Pine forests/mixed forests $3,000–$7,000 Woodland and mixed crops
Mid-Atlantic/Northeast small farm/lifestyle $10,000+/ac Including New York and Pennsylvania, high-competition lifestyle-oriented areas
2026 Forecast Trend: Farmland prices are expected to remain generally stable, with slight declines possible in Iowa and North Dakota, but gains in other states will offset the overall slight increase (0.%–2%). Commodity income and low loan interest rates support buyers' purchasing power. A tight supply of high-quality farmland and a strong pool of cash buyers will continue to maintain price stability.
III. Three Core Forms of American Farms
Category 1: Bare Land
Pure farmland, excluding residential buildings, containing only agricultural barns or irrigation facilities, with no residential land. Suitable for natural capital investors seeking diversified risk. Returns come from cash rental (providing stable cash flow to agricultural operators) or reservations for future carbon sink/solar energy development. Significant price advantage, as rent is locked in long-term by the Farm Credit System and is predictable. Purchasing bare land is the simplest transaction, less affected by AFIDA and state-level farmland restrictions (depending on the state's sensitivity), and avoids liability for renovations to historic buildings.
Category 2: Operating Farms
The most traditional American family farm model involves the owner directly cultivating crops or managing livestock, generating operating income, receiving CAP government subsidies, and natural capital project income. Typical farm sizes range from 100 acres to over 2,000 acres, and include farmhouses, barns, grain silos, machinery, etc., with prices ranging from $1 million to $8 million per TP4T. This model is suitable for professional farmers, buyers with an agricultural background, and rural enthusiasts. This type requires expertise but full eligibility for subsidies (provided citizenship requirements are met).
Category 3: Mixed-use rural estates (mixed Equestrian/Hunting/Farm Estate)
Most are upgraded residences (large mansions) with a small amount of farmland (pastures, haystacks), primarily targeting lifestyle buyers. The main income comes from land appreciation, agricultural rent, and hunting rentals, avoiding the complexities of active agricultural management.
IV. Key Market Developments in 2026
1. Farm income is at a five-year high, with net farm income approaching $180 billion. Gross profits in key sectors such as grains, soybeans, and livestock are supported by trade aid, subsidies, and a strong livestock sector by 2025. However, input costs remain high, and the decline in net crop income is partially offset by livestock (especially beef).
2. Farm Credit System borrowing costs are near historic lows. Lower lending rates from the FCS, commercial banks, and the USDA are encouraging bond market investors to enter the farmland market, making agricultural financing more accessible in 2026. The debt-to-asset ratio is projected to remain at approximately 13% throughout the year, lower than the average leverage of commercial real estate.
3. Foreign buyers face an increasingly stringent dual regulatory environment from both the federal and state levels. At the federal level: AFIDA reporting reforms have been strengthened, and CFIUS has increased its scrutiny of agricultural land transactions (especially those exceeding $5 million or 320 acres). At the state level: layered restrictive legislation—more than 24 states have prohibited or severely restricted entities or individuals from countries such as China, Russia, Iran, and North Korea from owning agricultural land within their states, with regulations based on the area of the agricultural land and the location of the property. A newer legislative trend is restricting direct purchases of agricultural land by foreign governments and individuals and entities from “hostile states,” or requiring pre-transaction registration and approval. This significantly increases the due diligence burden on foreign buyers.
4. Farmland values rose, but transaction volume declined. Farmland sales in Iowa decreased by 161 TP3T in 2025, with fewer land listings and less bidding. Sellers postponed sales due to uncertainties, causing high-priced farmland to completely exit the market.
5. Natural capital and the carbon market are becoming new drivers of farmland value. The Farm Act of 2026 will make evidence-based practices (soil testing, no-till farming, cover crops, etc.) a qualification requirement, and the EQIP grant will allocate $1.4 billion and the CSP grant will allocate $1.4 billion, which will further enhance the premium value of farmland that adopts high standards.
6. Estate tax exemption permanently increased to $15 million per person. The One Big Beautiful Bill Act permanently increases the federal estate and gift tax exemption to $15 million for single individuals and $30 million for married couples, adjusted for inflation, starting in 2026. For the vast majority of American family farms, the federal estate tax is no longer a major financial threat, increasing the attractiveness of farmland as a vehicle for intergenerational wealth.
Project Description
I. Core Positioning of the US Farm Market
The macro-level characteristics of the US farm market are "huge asset size, extremely high landlord-shareholder ratio, and long-term steady increase in land value." The average value of farmland nationwide in 2025 is $4,350 per acre (1 TP4T), an increase of $4.31 per acre (1.91 per acre after inflation adjustment) from 2024. In the near-term performance for 2025, arable land nationwide increased by $2.21 per acre after inflation adjustment, averaging $5,830 per acre (1 TP4T), while ranch land averaged $1,920 per acre (1 TP4T). Net farm income in the US is projected to reach approximately $180 billion per acre (1 TP4T) in 2025, an increase of approximately $291 per acre year-on-year.
Foreign buyers held approximately $45.2 billion in U.S. agricultural land between 2019 and 2023 (about 2.41 TP3T of all privately and foreign-owned agricultural land). Despite the relatively small historical data, foreign investment in agricultural land has been elevated to a national security level, and several bills for fiscal years 2025-2026 are pushing forward with measures to strengthen reporting and vetting requirements for foreign investors.
Special Note: At the federal level, AFIDA requires foreign buyers to report their agricultural land interests to the U.S. Department of Agriculture, but this does not automatically prohibit purchases. To date, there is no federal law in the U.S. uniformly limiting the amount or total area of agricultural land owned by foreign citizens. However, more than 24 states have enacted stricter laws restricting the purchase of agricultural land by specific foreign entities (especially entities from “hostile states”), and some state bans may directly prohibit foreigners from specific countries from purchasing farmland. Before purchasing, it is essential to clarify which state the farmland belongs to and assess whether state laws explicitly prohibit or require reporting by foreign buyers.
II. Price Range and State-Level Differences
The price of agricultural land in the United States is extremely uneven, depending on soil quality grade, irrigation capacity, urban or rural location, and other sources of income (carbon sinks, wind and solar leasing, etc.).
Regional/State Farmland/Pastoral/Mixed Price Range (per acre) Notes
Corn Belt / Midwest (Iowa, Illinois, Indiana, Minnesota): High-quality irrigated farmland, 1 TP 4T 8,300–1 TP 4T 13,000+. One of the most densely populated areas of farmland value in the United States.
Iowa (benchmark farm): Mixed crop + pasture: 1 TP 4 T 8,299/ac (down 1 TP 4 T 252 from peak). Projected to decline by 1.81 TP 3 T in 2025; demand is decreasing but prices remain in high range.
Nebraska farmland + ranch average price $3,905/ac (down 1%). Livestock sector supports ranch prices, but crop yields decreased by 16%.
South Dakota ranches + farmland saw a year-on-year increase of 7.91 TP3T, while ranches saw an increase of 12.81 TP3T, driven by strong demand from the livestock industry.
Wyoming ranches saw an 8.71 Tb3T increase in value over one year, driven by land scarcity and the premium associated with outdoor lifestyles.
In California's Central Valley, irrigated farmland accounts for 9,830+ TP4T/acre ($/acre = 2,450 acre of pasture). High-profit crops such as almonds, grapes, and tomatoes are being grown, with the pasture-to-farmland ratio expected to quadruple by 2025.
Western semi-arid region (New Mexico and parts of Texas): Irrigated/non-irrigated pastures, 1 TP 4 T 1,500–1 TP 4 T 4,000. Relying on livestock and limited crops, land prices are moderate.
Central Great Plains (Kansas, Oklahoma) Winter wheat/pasture: 1 TP 4 T 2,000 – 1 TP 4 T 6,000 (Varying)
Southeastern (Georgia, Alabama, etc.) Pine forests/mixed forests $3,000–$7,000 Woodland and mixed crops
Mid-Atlantic/Northeast small farm/lifestyle $10,000+/ac Including New York and Pennsylvania, high-competition lifestyle-oriented areas
2026 Forecast Trend: Farmland prices are expected to remain generally stable, with slight declines possible in Iowa and North Dakota, but gains in other states will offset the overall slight increase (0.%–2%). Commodity income and low loan interest rates support buyers' purchasing power. A tight supply of high-quality farmland and a strong pool of cash buyers will continue to maintain price stability.
III. Three Core Forms of American Farms
Category 1: Bare Land
Pure farmland, excluding residential buildings, containing only agricultural barns or irrigation facilities, with no residential land. Suitable for natural capital investors seeking diversified risk. Returns come from cash rental (providing stable cash flow to agricultural operators) or reservations for future carbon sink/solar energy development. Significant price advantage, as rent is locked in long-term by the Farm Credit System and is predictable. Purchasing bare land is the simplest transaction, less affected by AFIDA and state-level farmland restrictions (depending on the state's sensitivity), and avoids liability for renovations to historic buildings.
Category 2: Operating Farms
The most traditional American family farm model involves the owner directly cultivating crops or managing livestock, generating operating income, receiving CAP government subsidies, and natural capital project income. Typical farm sizes range from 100 acres to over 2,000 acres, and include farmhouses, barns, grain silos, machinery, etc., with prices ranging from $1 million to $8 million per TP4T. This model is suitable for professional farmers, buyers with an agricultural background, and rural enthusiasts. This type requires expertise but full eligibility for subsidies (provided citizenship requirements are met).
Category 3: Mixed-use rural estates (mixed Equestrian/Hunting/Farm Estate)
Most are upgraded residences (large mansions) with a small amount of farmland (pastures, haystacks), primarily targeting lifestyle buyers. The main income comes from land appreciation, agricultural rent, and hunting rentals, avoiding the complexities of active agricultural management.
IV. Key Market Developments in 2026
1. Farm income is at a five-year high, with net farm income approaching $180 billion. Gross profits in key sectors such as grains, soybeans, and livestock are supported by trade aid, subsidies, and a strong livestock sector by 2025. However, input costs remain high, and the decline in net crop income is partially offset by livestock (especially beef).
2. Farm Credit System borrowing costs are near historic lows. Lower lending rates from the FCS, commercial banks, and the USDA are encouraging bond market investors to enter the farmland market, making agricultural financing more accessible in 2026. The debt-to-asset ratio is projected to remain at approximately 13% throughout the year, lower than the average leverage of commercial real estate.
3. Foreign buyers face an increasingly stringent dual regulatory environment from both the federal and state levels. At the federal level: AFIDA reporting reforms have been strengthened, and CFIUS has increased its scrutiny of agricultural land transactions (especially those exceeding $5 million or 320 acres). At the state level: layered restrictive legislation—more than 24 states have prohibited or severely restricted entities or individuals from countries such as China, Russia, Iran, and North Korea from owning agricultural land within their states, with regulations based on the area of the agricultural land and the location of the property. A newer legislative trend is restricting direct purchases of agricultural land by foreign governments and individuals and entities from “hostile states,” or requiring pre-transaction registration and approval. This significantly increases the due diligence burden on foreign buyers.
4. Farmland values rose, but transaction volume declined. Farmland sales in Iowa decreased by 161 TP3T in 2025, with fewer land listings and less bidding. Sellers postponed sales due to uncertainties, causing high-priced farmland to completely exit the market.
5. Natural capital and the carbon market are becoming new drivers of farmland value. The Farm Act of 2026 will make evidence-based practices (soil testing, no-till farming, cover crops, etc.) a qualification requirement, and the EQIP grant will allocate $1.4 billion and the CSP grant will allocate $1.4 billion, which will further enhance the premium value of farmland that adopts high standards.
6. Estate tax exemption permanently increased to $15 million per person. The One Big Beautiful Bill Act permanently increases the federal estate and gift tax exemption to $15 million for single individuals and $30 million for married couples, adjusted for inflation, starting in 2026. For the vast majority of American family farms, the federal estate tax is no longer a major financial threat, increasing the attractiveness of farmland as a vehicle for intergenerational wealth.
Eligibility & Requirements
Evaluate
I. Advantages
1. High market depth and liquidity. U.S. farmland is considered one of the world's deepest and most transparent commodity land markets. The total value of agricultural assets (including agricultural real estate) is projected to be approximately $1 trillion to $4.3 trillion by 2025, indicating a high degree of capitalization. In grain-producing regions like Iowa, farmland auctions are frequent, providing buyers with a good exit strategy.
2. Stable long-term rental returns. Annual cash rent for farmland is approximately 1 TP4T161 per acre (national average, adjusted for inflation, down to 1.71 TP3T). Holding bare land and leasing it to professional farmers can generate relatively stable cash flow, which is highly attractive in a low-interest-rate environment.
3. Capital Gains Tax Deferral – Section 1031 Same-Type Exchange. After the sale of U.S. real estate (including farms), if the buyer provides written confirmation of the exchange within 45 days and completes the exchange within 180 days, capital gains tax can be deferred to a future sale. This provision does not create a tax exemption for foreign buyers if the farm's value increases and upgrades or regional reorganization is planned, but it can increase portfolio flexibility.
4. Starting in 2026, the $15 million federal estate tax exemption will significantly reduce the burden of inheriting castles. The previous situation where farm heirs were forced to sell land and pay taxes has been greatly improved, and compared with many European countries (France's Pacte Dutreil 75% exemption, Germany's estate tax as high as 30%-50%), it provides a high-value buffer for wealthy families with tight cash flow.
5. Foreign buyers owning farmland are not subject to federal restrictions in the United States; they are only subject to subsequent compliance and state-level limitations. There is no uniform federal ban on foreign investment in farmland. An AFIDA filing must be completed within 90 days of the transaction's completion. Generally, transactions are not subject to CFIUS intervention (unless the land is near sensitive areas such as military bases or energy facilities).
6. Diversified agricultural subsidy programs. The Department of Agriculture offers Farm Ownership Loans (up to $600,000 in direct loans and $2.3 million in guaranteed loans per $), Beginning Farmer Programs, and annual cash subsidies (the $12 billion Farmer Assistance Bridge Program per $). By 2025, corn farms will receive subsidies of $44.36 per $ per acre, soybeans $30.88 per acre, and wheat $39.35 per acre to mitigate the impact of commodity price volatility.
7. Farm Credit System offers flexible loan products. FCS specializes in long-term loans for farmland, with down payments of 20%–35% and interest rates 0.5–0.75 percentage points lower than commercial banks. Its loan approval focuses on agricultural cash flow rather than simply credit score.
II. Major Risks and Costs
1. The dual mandatory obligations of AFIDA reporting compliance and CFIUS review. The AFIDA Act requires any foreign individual or entity to report detailed information to the USDA within 90 days of acquiring or holding U.S. agricultural land. Failure to report is subject to fines and cannot be rectified. If the farmland is located near sensitive military facilities or critical energy infrastructure, and the buyer is a foreign entity, CFIUS may initiate a voluntary or mandatory notification review of the transaction, directly leading to delays or even rejection. If the target transaction meets the "reporting threshold" (amount exceeding $1.4 million or area exceeding 320 acres), CFIUS can conduct a national security review.
2. State farmland restriction laws have become the biggest obstacle to foreign investment. Since 2023, more than 24 states have passed laws restricting or prohibiting foreign governments, entities, and individuals (especially those from China, Russia, Iran, and North Korea) from acquiring farmland rights in their states. For example, Iowa prohibits certain foreign entities under "home country restrictions" from purchasing farmland exceeding a certain area, while Missouri directly prohibits entities from countries such as China from purchasing farmland in the state.
3. USDA loans and federal subsidies have significant restrictions on non-U.S. citizens. Most USDA loan programs (including FSA direct and guaranteed loans, crop insurance, and agricultural subsidies) require borrowers to be U.S. citizens, non-citizen nationals, or lawful permanent residents. This means that non-green card holders and non-immigrant foreigners from China cannot apply for these loans and must rely on nationwide financing channels.
4. High down payment requirements and varying loan application difficulties depending on the bank. Agricultural loans typically require a down payment of 20%–40%. Interest rates may be slightly higher if the farm is not owner-occupied and the transaction is cross-border. Repayment ability is based on the agricultural cash flow and independent income generation capacity of the farmland.
5. Environmental responsibility and regulatory costs for farmland are difficult to evade. These include federal compliance standards such as the Swampbuster and Sodbuster protection standards. If protected wetlands on farmland are filled in or illegally drained, significant penalties will be imposed. The EPA's regulatory costs for fertilizer and pesticide emissions are increasing year by year.
6. Farmland value is highly sensitive to commodity cycles. When prices of grains such as corn and soybeans plummet, farmland rental rates and sales speeds decrease significantly, easily affecting asset liquidity.
7. Capital gains tax for non-residents. When a non-U.S. resident sells farmland, the withholding tax rate is 15% (if the purchase exceeds a certain threshold). The Section 1031 tax exchange mechanism also applies to non-U.S. residents in principle, but is limited to the same taxpayer.
8. Leased farmers have a mandatory right of first refusal to renew the lease and an option to purchase (depending on state law). In some states, long-term cash lessees can request a right of first refusal from the buyer upon sale. The buyer must first confirm the status of the option with the lessee.
I. Advantages
1. High market depth and liquidity. U.S. farmland is considered one of the world's deepest and most transparent commodity land markets. The total value of agricultural assets (including agricultural real estate) is projected to be approximately $1 trillion to $4.3 trillion by 2025, indicating a high degree of capitalization. In grain-producing regions like Iowa, farmland auctions are frequent, providing buyers with a good exit strategy.
2. Stable long-term rental returns. Annual cash rent for farmland is approximately 1 TP4T161 per acre (national average, adjusted for inflation, down to 1.71 TP3T). Holding bare land and leasing it to professional farmers can generate relatively stable cash flow, which is highly attractive in a low-interest-rate environment.
3. Capital Gains Tax Deferral – Section 1031 Same-Type Exchange. After the sale of U.S. real estate (including farms), if the buyer provides written confirmation of the exchange within 45 days and completes the exchange within 180 days, capital gains tax can be deferred to a future sale. This provision does not create a tax exemption for foreign buyers if the farm's value increases and upgrades or regional reorganization is planned, but it can increase portfolio flexibility.
4. Starting in 2026, the $15 million federal estate tax exemption will significantly reduce the burden of inheriting castles. The previous situation where farm heirs were forced to sell land and pay taxes has been greatly improved, and compared with many European countries (France's Pacte Dutreil 75% exemption, Germany's estate tax as high as 30%-50%), it provides a high-value buffer for wealthy families with tight cash flow.
5. Foreign buyers owning farmland are not subject to federal restrictions in the United States; they are only subject to subsequent compliance and state-level limitations. There is no uniform federal ban on foreign investment in farmland. An AFIDA filing must be completed within 90 days of the transaction's completion. Generally, transactions are not subject to CFIUS intervention (unless the land is near sensitive areas such as military bases or energy facilities).
6. Diversified agricultural subsidy programs. The Department of Agriculture offers Farm Ownership Loans (up to $600,000 in direct loans and $2.3 million in guaranteed loans per $), Beginning Farmer Programs, and annual cash subsidies (the $12 billion Farmer Assistance Bridge Program per $). By 2025, corn farms will receive subsidies of $44.36 per $ per acre, soybeans $30.88 per acre, and wheat $39.35 per acre to mitigate the impact of commodity price volatility.
7. Farm Credit System offers flexible loan products. FCS specializes in long-term loans for farmland, with down payments of 20%–35% and interest rates 0.5–0.75 percentage points lower than commercial banks. Its loan approval focuses on agricultural cash flow rather than simply credit score.
II. Major Risks and Costs
1. The dual mandatory obligations of AFIDA reporting compliance and CFIUS review. The AFIDA Act requires any foreign individual or entity to report detailed information to the USDA within 90 days of acquiring or holding U.S. agricultural land. Failure to report is subject to fines and cannot be rectified. If the farmland is located near sensitive military facilities or critical energy infrastructure, and the buyer is a foreign entity, CFIUS may initiate a voluntary or mandatory notification review of the transaction, directly leading to delays or even rejection. If the target transaction meets the "reporting threshold" (amount exceeding $1.4 million or area exceeding 320 acres), CFIUS can conduct a national security review.
2. State farmland restriction laws have become the biggest obstacle to foreign investment. Since 2023, more than 24 states have passed laws restricting or prohibiting foreign governments, entities, and individuals (especially those from China, Russia, Iran, and North Korea) from acquiring farmland rights in their states. For example, Iowa prohibits certain foreign entities under "home country restrictions" from purchasing farmland exceeding a certain area, while Missouri directly prohibits entities from countries such as China from purchasing farmland in the state.
3. USDA loans and federal subsidies have significant restrictions on non-U.S. citizens. Most USDA loan programs (including FSA direct and guaranteed loans, crop insurance, and agricultural subsidies) require borrowers to be U.S. citizens, non-citizen nationals, or lawful permanent residents. This means that non-green card holders and non-immigrant foreigners from China cannot apply for these loans and must rely on nationwide financing channels.
4. High down payment requirements and varying loan application difficulties depending on the bank. Agricultural loans typically require a down payment of 20%–40%. Interest rates may be slightly higher if the farm is not owner-occupied and the transaction is cross-border. Repayment ability is based on the agricultural cash flow and independent income generation capacity of the farmland.
5. Environmental responsibility and regulatory costs for farmland are difficult to evade. These include federal compliance standards such as the Swampbuster and Sodbuster protection standards. If protected wetlands on farmland are filled in or illegally drained, significant penalties will be imposed. The EPA's regulatory costs for fertilizer and pesticide emissions are increasing year by year.
6. Farmland value is highly sensitive to commodity cycles. When prices of grains such as corn and soybeans plummet, farmland rental rates and sales speeds decrease significantly, easily affecting asset liquidity.
7. Capital gains tax for non-residents. When a non-U.S. resident sells farmland, the withholding tax rate is 15% (if the purchase exceeds a certain threshold). The Section 1031 tax exchange mechanism also applies to non-U.S. residents in principle, but is limited to the same taxpayer.
8. Leased farmers have a mandatory right of first refusal to renew the lease and an option to purchase (depending on state law). In some states, long-term cash lessees can request a right of first refusal from the buyer upon sale. The buyer must first confirm the status of the option with the lessee.
Application Process & Advice
suggestion
I. Understand the laws restricting foreign buyers of agricultural land in each state.
Given the significant differences in state policies, foreign buyers should assess the following dimensions before making a purchase decision: Does the state prohibit foreign investment in agricultural land? If so, are there any additional requirements (size limits, mandatory administrative permits, reporting to the state's agricultural department)? Is the property located in a "sensitive area" jointly designated by the state and the Department of Defense? What percentage of foreign ownership would trigger the "significant interest" test?
II. Determine the final use and investment objectives of the farm.
Type Applicable Buyer Budget Return Expectation
Pure bare land investment in carbon sinks / Institutional investors / Lifestyle landowners: 1TP 4T 100,000 – 1TP 4T 2,000,000 41TP 3T – 61TP 3T Annualized rental income + land value appreciation
Operating family farms (self-managed) Professional farmers and agricultural operators (must have US citizenship) $ 2 million – $ 8 million or more, variable cash income + subsidies + land appreciation
Mixed-use country estates offer a lifestyle option for high-net-worth buyers. Potential rental income plus land appreciation ($) for $800,000–$2,500,000 per $ estate, achieving break-even.
If you are buying farmland for the first time and do not have legal status in the United States, prioritize small bare land, make a down payment of 351 TP 3T–501 TP 3T and seek seller financing or a limited liability company (LLC) structure to simplify title liability.
III. Establishing a professional team
• Agricultural real estate brokers (familiar with farm sales, such as network members recommended by Farm Credit Services or Peoples Company, Hertz Farm Management): assess comparable sales (Comps), soil yields, irrigation rights, etc.
• Agricultural lawyers (familiar with land ownership, environmental compliance, and tax planning): handle state land restriction law compliance, title searches, and lease agreements.
• Certified Public Accountant (CPA) / Tax Advisor: Planning for non-resident withholding tax, considering corporate structure (direct LLC ownership, or trust structure).
• Certified General Appraiser: Provides pricing information for loans and/or estate planning.
• Farm Manager (can be managed remotely): Responsible for tenant management, cash flow registration, and crop insurance after the transfer of ownership.
IV. Obligation to comply with AFIDA reporting
Foreign buyers must file Form FSA-153 with the USDA's Agricultural Services (FSA) within 90 days of the transaction. This form is completed with the assistance of a lawyer, and failure to file on time will not cancel the transaction but may trigger penalties. If the buyer's domestic entity (such as a U.S.-registered Limited Liability Company, LLC) is "materially controlled," information about its foreign shareholders must also be disclosed in the filing.
The USDA's public consultation on AFIDA reforms, launched on December 29, 2025, may lead to further tightening of the reporting requirements, potentially requiring the uploading of site maps and proof of land use in the future.
V. Financing Channels – Utilizing FCS and Seller Financing to Hedge Loan Barriers
Since non-US citizens generally cannot apply for FSA loans, the loan method should be:
• Farm Credit System (FCS): Specifically designed for agriculture, this cooperative bank provides loans to qualified borrowers with down payments of 20%–35% and terms of 15–30 years.
• Seller financing (Land Contract or Seller Financing): Commonly used in farm transactions, where the buyer pays the seller in installments, avoiding the green card requirements of traditional bank loans.
• Direct lending (traditional commercial banks): Additional guarantees may be required due to the foreigner's status.
VI. Estate Tax Planning – Utilizing the $1,500,000 Exemption
Under the One Big Beautiful Bill Act, starting in 2026, the federal estate tax exemption is $ $15 million per person. For married couples, the exemption is $ $30 million. Because the U.S. has a Stepped-up Basis rule, the tax base for inherited property is adjusted to market value, allowing heirs to avoid previously incurred capital gains tax when selling a ranch. Foreign buyers may not be able to fully enjoy this benefit, but effective planning is still possible.
For U.S. farms that exceed the exemption threshold, taxable estates can be legally reduced by establishing an irrevocable trust or by granting gifts tax-free (in 2026, each person can receive a tax-free gift of $19,000 per year).
VII. Due Diligence – Purchase of Agricultural Land Must Exceed Residential Standards
The following is a core checklist for the acquisition of farms by Chinese and foreign companies:
• Soil Productivity Index: Provided by the NRCS Web Soil Survey, this index checks pH, drainage, and historical crop yield. The Illinois unirrigated soil index is approximately $130–$150, with values below 100 indicating poor-quality farmland.
• Irrigation rights/water resource allocation (most important in western states).
• Drainage pipe system (costs over $1 per 4 tons per acre for farm conversion in the Midwest).
• Government involvement in initiatives: CRP Protected Reserve Program, EQIP, CSP, and future carbon program agreements to understand whether land is affected by land closures or regulations.
• Tenant lease structure: Check for long-term cash leases and farmer options.
• Land boundaries and geodesy.
• Mining rights and wind/solar easements: Has the mining right been stripped away? Has a wind power lease agreement been signed? The landowner retains the right to charge for the lease of the upper space.
VIII. Handling Crop Insurance and Subsidy Transfers
The USDA Risk Management Authority (RMA) provides crop insurance annually for farmland, covering yield or income losses. If the farmland already has a history of subsidy payments, the buyer must register with the FSA to update the owner after the transfer of ownership and change the crop insurance policy and subsidy contact person.
Process of purchasing a US farm
In the United States, the standard procedure for farm transactions, from submitting an offer (which will go through a letter of intent or LOI stage before the final contract), is as follows. The transaction cycle is usually 60–120 days, longer than the 30–45 days for a typical residential transaction.
Phase 1: Financial Preparation and Regulatory Screening (6–10 weeks)
• Determine the overall budget: Purchase price + transaction costs (notary/title/survey/measurement) + environmental survey;
• Hire agricultural lawyers, appraisers, and agricultural bankers;
• Apply for Loan in Principle (LOI) approval from FCS or Agricultural Credit Bank;
• Confirm state agricultural legislation restricting the foreign buyer's identity;
• Determine the ownership structure – sole proprietorship or limited liability company (LLC);
Phase Two: Farm Search, Inspection, and Quotation (1–6 months)
• Contact agricultural real estate brokers and use platforms such as Land.com, LandWatch, and FarmFlips to filter listings, or look for court auction/estate sellers;
• To participate in bidding at farmland auctions, a bid deposit must be paid before the auction (generally ranging from $10,000 to $50,000).
• When making a private offer, draft a written Purchase Agreement (or a standard farm title contract) specifying a unique due diligence period (45–90 days).
• Pay the seller a deposit of earnest money, typically 1%–5%, held in escrow by the title company/escrow agent;
Phase 3: Due Diligence (45–90 days)
The following specific professional tests will be conducted:
• Title Search + Title Insurance – Conducted by Chinese lawyers or title companies, covering easements (roads crossing farmland or government-mandated areas);
• Soil survey and groundwater/drainage verification – Water resource allocation needs to be verified in the west, and underground pipe mapping needs to be carried out in the midwest (cost $5–$15/acre).
• Environmental Assessment – Phase I ESA Investigation (Is there a risk of toxic chemicals in the field or illegally stored waste?)
• Lease verification – If a tenant already exists, obtain a copy of the existing lease agreement, clearly specifying the lease type and termination rights;
• Compliance audits of government projects (CRP program or EQIP participation) to ensure that there are no violations or penalties for historical subsidy payments;
• Transfer and renewal of ownership of crop insurance policies (if applicable)
Phase Four: Signing the final purchase and sale agreement and signing the title documents
• Both parties sign a formal Purchase and Sale Agreement, confirming the Closing Date;
• Sign the title deed (Type of Deed), usually a General Warranty Deed to guarantee the cleanliness of the title; a Special Warranty Deed can also be chosen through negotiation with the buyer.
• The buyer shall pay the final payment as agreed (after deducting the previously paid deposit). The buyer must have the funds ready and provide proof of funds before the Closing Date to meet anti-money laundering requirements;
• The seller signs the transfer of ownership on the signing date, and the buyer settles the remaining balance through the title company.
Phase 5: Transfer of Ownership and AFIDA Filing
• The title company registers the land title with the Count Recorder (county-level registration);
• The new land title is delivered to the buyer (legal commencement of ownership);
• Within 90 days of the transaction, submit Form AFIDA (FSA-153) to the USDA (FSA: Agricultural Service), specifying the buyer's foreign ownership status, purpose of purchase, area, and purchase price;
• If there are cash-lease tenants on the farm, the Agricultural Service must be notified to update all information after the transfer;
Phase 6: Post-Closing Management
• Signing new leases or renewing existing leases and relationships with tenants;
• Purchase comprehensive agricultural liability insurance (at least $ liability insurance with a coverage of 1 million or more).
• Appoint a farm manager or operate in-house (Midwest cost $15–$25/acre).
Overall Time Frame
The estimated time required for each phase of work
Funding preparation + pre-approval of financing + legal/advisor evaluation (6-10 weeks)
Farm search and bidding process takes 1–6 months (high-quality farms face intense competition).
Due diligence + soil/survey/property rights/environment 45–90 days
Signing of final purchase agreement and transfer of title: 1–3 weeks
Closing to ownership transfer takes 1–2 days
AFIDA declaration (within 90 days after the transaction)
Non-U.S. residents need to allow more time for financial preparation and loan pre-approval (loan capacity and residency are not thresholds, but an additional down payment is required). The normal cycle from the initial offer to the final transfer of ownership is approximately 5 to 9 months, and it does not involve any FSA subsidies and is solely for personal investment purposes.
I. Understand the laws restricting foreign buyers of agricultural land in each state.
Given the significant differences in state policies, foreign buyers should assess the following dimensions before making a purchase decision: Does the state prohibit foreign investment in agricultural land? If so, are there any additional requirements (size limits, mandatory administrative permits, reporting to the state's agricultural department)? Is the property located in a "sensitive area" jointly designated by the state and the Department of Defense? What percentage of foreign ownership would trigger the "significant interest" test?
II. Determine the final use and investment objectives of the farm.
Type Applicable Buyer Budget Return Expectation
Pure bare land investment in carbon sinks / Institutional investors / Lifestyle landowners: 1TP 4T 100,000 – 1TP 4T 2,000,000 41TP 3T – 61TP 3T Annualized rental income + land value appreciation
Operating family farms (self-managed) Professional farmers and agricultural operators (must have US citizenship) $ 2 million – $ 8 million or more, variable cash income + subsidies + land appreciation
Mixed-use country estates offer a lifestyle option for high-net-worth buyers. Potential rental income plus land appreciation ($) for $800,000–$2,500,000 per $ estate, achieving break-even.
If you are buying farmland for the first time and do not have legal status in the United States, prioritize small bare land, make a down payment of 351 TP 3T–501 TP 3T and seek seller financing or a limited liability company (LLC) structure to simplify title liability.
III. Establishing a professional team
• Agricultural real estate brokers (familiar with farm sales, such as network members recommended by Farm Credit Services or Peoples Company, Hertz Farm Management): assess comparable sales (Comps), soil yields, irrigation rights, etc.
• Agricultural lawyers (familiar with land ownership, environmental compliance, and tax planning): handle state land restriction law compliance, title searches, and lease agreements.
• Certified Public Accountant (CPA) / Tax Advisor: Planning for non-resident withholding tax, considering corporate structure (direct LLC ownership, or trust structure).
• Certified General Appraiser: Provides pricing information for loans and/or estate planning.
• Farm Manager (can be managed remotely): Responsible for tenant management, cash flow registration, and crop insurance after the transfer of ownership.
IV. Obligation to comply with AFIDA reporting
Foreign buyers must file Form FSA-153 with the USDA's Agricultural Services (FSA) within 90 days of the transaction. This form is completed with the assistance of a lawyer, and failure to file on time will not cancel the transaction but may trigger penalties. If the buyer's domestic entity (such as a U.S.-registered Limited Liability Company, LLC) is "materially controlled," information about its foreign shareholders must also be disclosed in the filing.
The USDA's public consultation on AFIDA reforms, launched on December 29, 2025, may lead to further tightening of the reporting requirements, potentially requiring the uploading of site maps and proof of land use in the future.
V. Financing Channels – Utilizing FCS and Seller Financing to Hedge Loan Barriers
Since non-US citizens generally cannot apply for FSA loans, the loan method should be:
• Farm Credit System (FCS): Specifically designed for agriculture, this cooperative bank provides loans to qualified borrowers with down payments of 20%–35% and terms of 15–30 years.
• Seller financing (Land Contract or Seller Financing): Commonly used in farm transactions, where the buyer pays the seller in installments, avoiding the green card requirements of traditional bank loans.
• Direct lending (traditional commercial banks): Additional guarantees may be required due to the foreigner's status.
VI. Estate Tax Planning – Utilizing the $1,500,000 Exemption
Under the One Big Beautiful Bill Act, starting in 2026, the federal estate tax exemption is $ $15 million per person. For married couples, the exemption is $ $30 million. Because the U.S. has a Stepped-up Basis rule, the tax base for inherited property is adjusted to market value, allowing heirs to avoid previously incurred capital gains tax when selling a ranch. Foreign buyers may not be able to fully enjoy this benefit, but effective planning is still possible.
For U.S. farms that exceed the exemption threshold, taxable estates can be legally reduced by establishing an irrevocable trust or by granting gifts tax-free (in 2026, each person can receive a tax-free gift of $19,000 per year).
VII. Due Diligence – Purchase of Agricultural Land Must Exceed Residential Standards
The following is a core checklist for the acquisition of farms by Chinese and foreign companies:
• Soil Productivity Index: Provided by the NRCS Web Soil Survey, this index checks pH, drainage, and historical crop yield. The Illinois unirrigated soil index is approximately $130–$150, with values below 100 indicating poor-quality farmland.
• Irrigation rights/water resource allocation (most important in western states).
• Drainage pipe system (costs over $1 per 4 tons per acre for farm conversion in the Midwest).
• Government involvement in initiatives: CRP Protected Reserve Program, EQIP, CSP, and future carbon program agreements to understand whether land is affected by land closures or regulations.
• Tenant lease structure: Check for long-term cash leases and farmer options.
• Land boundaries and geodesy.
• Mining rights and wind/solar easements: Has the mining right been stripped away? Has a wind power lease agreement been signed? The landowner retains the right to charge for the lease of the upper space.
VIII. Handling Crop Insurance and Subsidy Transfers
The USDA Risk Management Authority (RMA) provides crop insurance annually for farmland, covering yield or income losses. If the farmland already has a history of subsidy payments, the buyer must register with the FSA to update the owner after the transfer of ownership and change the crop insurance policy and subsidy contact person.
Process of purchasing a US farm
In the United States, the standard procedure for farm transactions, from submitting an offer (which will go through a letter of intent or LOI stage before the final contract), is as follows. The transaction cycle is usually 60–120 days, longer than the 30–45 days for a typical residential transaction.
Phase 1: Financial Preparation and Regulatory Screening (6–10 weeks)
• Determine the overall budget: Purchase price + transaction costs (notary/title/survey/measurement) + environmental survey;
• Hire agricultural lawyers, appraisers, and agricultural bankers;
• Apply for Loan in Principle (LOI) approval from FCS or Agricultural Credit Bank;
• Confirm state agricultural legislation restricting the foreign buyer's identity;
• Determine the ownership structure – sole proprietorship or limited liability company (LLC);
Phase Two: Farm Search, Inspection, and Quotation (1–6 months)
• Contact agricultural real estate brokers and use platforms such as Land.com, LandWatch, and FarmFlips to filter listings, or look for court auction/estate sellers;
• To participate in bidding at farmland auctions, a bid deposit must be paid before the auction (generally ranging from $10,000 to $50,000).
• When making a private offer, draft a written Purchase Agreement (or a standard farm title contract) specifying a unique due diligence period (45–90 days).
• Pay the seller a deposit of earnest money, typically 1%–5%, held in escrow by the title company/escrow agent;
Phase 3: Due Diligence (45–90 days)
The following specific professional tests will be conducted:
• Title Search + Title Insurance – Conducted by Chinese lawyers or title companies, covering easements (roads crossing farmland or government-mandated areas);
• Soil survey and groundwater/drainage verification – Water resource allocation needs to be verified in the west, and underground pipe mapping needs to be carried out in the midwest (cost $5–$15/acre).
• Environmental Assessment – Phase I ESA Investigation (Is there a risk of toxic chemicals in the field or illegally stored waste?)
• Lease verification – If a tenant already exists, obtain a copy of the existing lease agreement, clearly specifying the lease type and termination rights;
• Compliance audits of government projects (CRP program or EQIP participation) to ensure that there are no violations or penalties for historical subsidy payments;
• Transfer and renewal of ownership of crop insurance policies (if applicable)
Phase Four: Signing the final purchase and sale agreement and signing the title documents
• Both parties sign a formal Purchase and Sale Agreement, confirming the Closing Date;
• Sign the title deed (Type of Deed), usually a General Warranty Deed to guarantee the cleanliness of the title; a Special Warranty Deed can also be chosen through negotiation with the buyer.
• The buyer shall pay the final payment as agreed (after deducting the previously paid deposit). The buyer must have the funds ready and provide proof of funds before the Closing Date to meet anti-money laundering requirements;
• The seller signs the transfer of ownership on the signing date, and the buyer settles the remaining balance through the title company.
Phase 5: Transfer of Ownership and AFIDA Filing
• The title company registers the land title with the Count Recorder (county-level registration);
• The new land title is delivered to the buyer (legal commencement of ownership);
• Within 90 days of the transaction, submit Form AFIDA (FSA-153) to the USDA (FSA: Agricultural Service), specifying the buyer's foreign ownership status, purpose of purchase, area, and purchase price;
• If there are cash-lease tenants on the farm, the Agricultural Service must be notified to update all information after the transfer;
Phase 6: Post-Closing Management
• Signing new leases or renewing existing leases and relationships with tenants;
• Purchase comprehensive agricultural liability insurance (at least $ liability insurance with a coverage of 1 million or more).
• Appoint a farm manager or operate in-house (Midwest cost $15–$25/acre).
Overall Time Frame
The estimated time required for each phase of work
Funding preparation + pre-approval of financing + legal/advisor evaluation (6-10 weeks)
Farm search and bidding process takes 1–6 months (high-quality farms face intense competition).
Due diligence + soil/survey/property rights/environment 45–90 days
Signing of final purchase agreement and transfer of title: 1–3 weeks
Closing to ownership transfer takes 1–2 days
AFIDA declaration (within 90 days after the transaction)
Non-U.S. residents need to allow more time for financial preparation and loan pre-approval (loan capacity and residency are not thresholds, but an additional down payment is required). The normal cycle from the initial offer to the final transfer of ownership is approximately 5 to 9 months, and it does not involve any FSA subsidies and is solely for personal investment purposes.