According to a National Land Realty study, the 2023 housing market uncertainty extends to rural land. However, most agents remain positive and many buyers are taking advantage of the slight price decline to buy land.
National Land Realty has released its third annual survey of land brokers and agents. The key findings include that 2022 was a year when many properties appreciated, but many agents see 2023 as a year of stabilization, limited depreciation and stability. However, only 7.54% of agents foresee a decrease of more than 5%.
Agents anticipate 2023 to be another busy season where buyers will take advantage of the limited price correction opportunities. They remain optimistic about their business prospects for the next year, with nearly two-thirds (64%) being either very or somewhat optimistic.
Jason Walter, CEO, National Land, stated that “Even with the macroeconomic headwinds in the horizon”, most agents remain optimistic about their business prospects over this next year. “Buyers continue looking for stability in economically volatile times, and land continues being appreciated by investors for its stability.”
Survey results showed that there was a significant land appreciation in rural land real estate in 2022. Nearly two-thirds (64%) of agents saw a slight to a often significant increase in land value, with residential, farmland and recreational being the most notable types.
Walter stated, “What is important is that although our agents see a positive business outlook for 2023, they expect a softening in land appreciation with almost three quarters of them not expecting any appreciation.”
Land Values in 2022
Brokers saw the greatest increase in recreational land [49.07%], followed closely by farmland (22.3%]. With 17.59% of brokers stating that residential land had experienced the greatest increase, residential came in third. The top five were completed by ranch land [4.63%] and timberland [7.41%].
2021-2022 Land Valuation Appreciation (based upon % of agents).
Appreciation20212022> 10.0%40.48%22.69%5.1%-10.0%26.19%16.81%0.1%-5.0%17.86%17.86%No Increase8.33%14.29%Decrease0%15.12%2023 Land Appreciation Agent Outlook (based on % of agents)
Appreciation% of Agents> 10.0%3.36%5.1%-10.0%10.92%0.1%-5.0%13.45%No Increase33.61Decrease32.77