College Station (Brazos County) — Second quarter numbers released Tuesday by the Real Estate Center at Texas A&M University show a Texas land market hit hard by plummeting oil prices and the pandemic.
Research Economist Dr. Charles Gilliland issued the state’s land report card:
- Price: + 1.7%
- Sales volume: – 8.7%
- Average acreage sold: – 9.1%
- Total acres sold: – 23.5%
- Total dollar volume: -22.2%
“The average $2,929-per-acre sales price inched up 1.7 percent, well short of the 6.5 percent increase in the first quarter and falling short of that quarter’s $2,986-per-acre price,” Gilliland said. “Closed land sales dropped 8.7 percent, more than double the decline posted in the first quarter.”
Typical transaction size fell 9.1 percent to 1,217 acres. Gilliland said this points to an increase in the sales of smaller properties.
The drop in activity resulted in a 23.5 percent decline in the number of acres sold compared with a first-quarter dip of 4.3 percent.
That decline caused the total dollar volume to fall 22.2 percent to $1.1 billion, down from a first-quarter increase of 6.1 percent.
“Overall, Texas land market results are encouraging considering the negative forces impacting the state and world economies,” said Gilliland, who has tracked Texas land markets for four decades. “Regional results varied.”
Panhandle-South Plains’ prices retreated, and Far West Texas had a profound drop in activity along with lower prices. West Texas and Northeast Texas markets had increasing prices but contracting numbers of transactions and total acres sold.
“The Gulf Coast-Brazos Bottom and South Texas regions posted modest price increases accompanied by falling sales and lower dollar volumes,” said Gilliland. “Austin-Waco-Hill Country saw little price change while the number of sales remained steady and dollar volume modestly declined.
“These results suggest land markets have weathered the storm well. Reports from the field suggest brokers are seeing interest in rural land increase, which may point to a stronger market in the future.”
Statistics represent transactions reported by land market professionals. The reported sample of sales does not include all Texas sales. However, Gilliland said the large sample effectively represents market developments.
Edited from a Texas A&M Univ. Real Estate Center news release.