•Spring 2017

LAND / Buying Land
redicting return on investment when purchasing
land can be hard to nail down. While no one
can truly predict what the ROI of an investment
will be, looking to industry indicators is a good start
when choosing where to place your hard earned money.
The good news is that there are resources available to
those in the market for land real estate. In addition to
finding a qualified land consultant, looking to industry
surveys and reports can provide the guidance needed to
purchase a property.
Every year, the REALTORS® Land Institute and the
National Association of REALTORS® release a Land
Market Survey to help buyers and sellers of land make
the most informed decisions possible. With responses
from land real estate professionals across the country,
its results are indicative of which overall land real estate
market trends to pay attention to when making investment
decisions. A large percentage of the participants are
Accredited Land Consultants (ALCs), the most esteemed,
experienced, and well-educated brokers/agents in the
industry, lending further credibility to the survey results.
Now, let’s dig into why now is an opportune time to
purchase land real estate. According to this year’s survey
results released on February 14, 2017, the industry’s top
land professionals predict an average growth in sales
volume of two percent across all land types through
October 2017, with a three percent growth expected
in each sector for timber, residential, and agricultural
greenfield development land. As far as prices of land,
an increase is also seen across all sectors defined in the
survey. The highest predicted sales volume increases are
attributed to timberland and residential land at a rate of
three percent, closely followed by agricultural land at two
percent and commercial land at one percent.
WRITTEN BY JESSA FRIEDRICH, MBA
Yes, these are all predictions. However, when compared
with actual transaction data from respondents, the trends
fall in line with past sales data. As reported in the survey,
overall prices of land across all sectors averaged a one
percent increase, with the highest price increases in
timberland at five percent and residential land at three
percent. Another important take away is that the average
time on the market for a piece of land was reported as
one-hundred days, selling more quickly for agricultural
non-irrigated, timberland, and recreational properties.
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