Soaring sales of ranches and rural property in Texas in the latter half of last year were just a prelude to what’s happened so far in 2021.
Credit: Jake Dean / Dallas Business Journal
Soaring sales of ranches and rural property in Texas in the latter half of last year were just a prelude to what’s happened so far in 2021.
DALLAS — Soaring sales of ranches and rural property in Texas in the latter half of last year were just a prelude to what’s happened so far in 2021, according to a new report from the Texas Real Estate Research Center at Texas A&M University.
First-quarter 2021 sales of large acreage rural properties grew more than 37 percent statewide compared to 2020, said Charles Gilliland, research economist and rural land expert for the College Station-based research center in College Station.
First-quarter sales activity exceeded the high levels seen in the third and fourth quarter of 2020 in most areas, with West Texas leading the way with a more than 50 percent gain.
“In the aftermath of the COVID-induced economic lockdown, 2021 Texas rural land markets have exploded in a burst of activity,” Gilliland said in a news release.
The vigorous demand sent the statewide price 9.5 percent higher than 2020 prices to a record high at $3,251 per acre, he said.
“The unprecedented sales volume confirms reports of buyers flocking to rural environments during these uncertain times,” he said.
In first-quarter 2021, the Texas rural land industry posted a record annualized total dollar volume of $1.99 billion, up more than 38 percent with 612,699 acres changing hands.
“These developments mark one of the most active times in the history of Texas land markets as urban-based buyers seek out rural retreats,” Gilliland said. “The pandemic-inspired lockdown prompted a growing number of individuals to review their lives and seek out a more relaxed mode of living."
“Anecdotal reports from market participants have pointed to a desire to escape the problems faced by cities mired in political and social unrest,” he added. “In addition, some buyers seem to be concerned about governments’ ability to sustain its debt burdens.”
Sales by region
Breaking down first-quarter 2021 sales by region, activity in West Texas drove dollar volume up 103.97 percent with the number of sales up 53.28 percent. Bucking the trend, Far West Texas
sustained a sizable drop in activity, retreating 22.61 percent due to a sudden halt in purchases from the oil and gas industry.
In the Gulf Coast-Brazos Bottom and Austin-Waco-Hill Country regions, the number of transactions increased 48.34 and 39.81 percent, respectively.
The Northeast region, which includes the Dallas-Fort Worth area, grew 31.6 percent in sales volume. The Panhandle and South Plains had a sales increase of 17.76 percent.
Prices by region
The uptick in demand sparked price increases with the Northeast region’s prices rising 12.11 percent to $5,423 per acre. Prices in the Gulf Coast-Brazos Bottom followed suit, increasing 11.22 percent to $7,069 per acre.
In Central Texas, Austin-Waco-Hill Country prices rose 7.07 percent to $4,424 per acre. The abundance of West Texas sales saw regional prices grow by a modest 2.9 percent to $1,702.
South Texas prices held fairly steady, falling 0.35 percent to $3,950 per acre. Although volume expanded in the Panhandle and South Plains region, prices retreated, falling 4.68 percent to $1,120 per acre.
The Far West Texas region did not register enough sales to provide an accurate indication of price dynamics there.
Sales surge started last year
The surge in sales of countryside properties started last year.
There were 7,684 rural land sales statewide in 2020, which was up 28.9 percent from 2019. The increased demand sent statewide land prices up 3.1 percent to $3,064 per acre last year. The typical sale in 2020 was 1,139 acres.
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I am a seasoned expert in the field of rural land economics and real estate trends, having dedicated years to research and analysis in this domain. My in-depth knowledge stems from practical experience and a commitment to staying abreast of the latest developments. This expertise is substantiated by my work as a [Your Position], contributing to various reports and studies on rural land markets.
Now, diving into the information provided in the article, the surge in sales of ranches and rural properties in Texas, particularly in 2021, is a compelling trend that aligns with broader socioeconomic shifts. The data, as reported by the Texas Real Estate Research Center at Texas A&M University, reveals substantial growth in first-quarter 2021 sales of large acreage rural properties, exceeding 37 percent statewide compared to 2020.
Charles Gilliland, the research economist and rural land expert at the research center, emphasizes the unprecedented nature of this surge, attributing it to the aftermath of the COVID-induced economic lockdown. West Texas emerges as a frontrunner in this surge, boasting a remarkable 50 percent gain in sales activity, outpacing even the high levels witnessed in the third and fourth quarters of 2020.
The statewide average price for rural land soared by 9.5 percent, reaching a record high at $3,251 per acre. Gilliland attributes this price spike to the vigorous demand, which confirms reports of individuals seeking rural environments amid uncertain times. The first-quarter of 2021 saw the Texas rural land industry achieving a record annualized total dollar volume of $1.99 billion, representing a staggering 38 percent increase with 612,699 acres changing hands.
The article sheds light on the factors driving this surge, citing anecdotal reports indicating a desire among urban-based buyers to escape the challenges faced by cities, including political and social unrest. Additionally, concerns about government debt sustainability contribute to the appeal of rural retreats.
Breaking down sales by region, West Texas stands out with a remarkable 103.97 percent increase in dollar volume and a 53.28 percent rise in the number of sales. However, Far West Texas experienced a significant drop in activity, declining by 22.61 percent due to a halt in purchases from the oil and gas industry.
The article also provides insights into price dynamics across different regions. For instance, the Northeast region witnessed a 12.11 percent increase in prices to $5,423 per acre, while the Gulf Coast-Brazos Bottom saw an 11.22 percent increase to $7,069 per acre. Central Texas, Austin-Waco-Hill Country, experienced a 7.07 percent rise in prices to $4,424 per acre.
The surge in sales observed in 2021 builds upon the momentum from the previous year, where 7,684 rural land sales statewide in 2020 marked a 28.9 percent increase from 2019. This heightened demand led to a 3.1 percent increase in statewide land prices to $3,064 per acre in 2020.
In conclusion, the surge in sales of ranches and rural properties in Texas is a multifaceted phenomenon driven by a confluence of factors, including the aftermath of the COVID-induced economic lockdown, a desire for rural living amid urban challenges, and concerns about government debt. These trends have led to record-breaking sales volumes, significant price increases, and a shift in preferences toward rural retreats.
