The Texas rural land market saw a "modest expansion" in both the number of sales and total acreage transferred in 2012, reports Dr. Charles E. Gilliland, Real Estate Center, Texas A&M University. In addition to the rise in sale volume and transaction size the market also posted a 6% increase in the value of an average acre of rural Texas land.
At the recent 23rd annual Outlook for Texas Land Markets in San Antonio, Gilliland said the recent upswing in both volume and size of transactions "suggest pent-up demand has slowly begun to ignite activity. Those results made 2012 the most active year since 2008. Sale volumes continued to approach numbers of transactions last posted in the 1990-2000 era."
He believes fears land prices would eventually drop, "so evident in the past several years," which made buyers reluctant to purchase, "appear to have abated in 2012. In addition, buyers seem to have grown weary of delaying their plans and may even have begun to anticipate rising prices in the years ahead."
"In fact," he continues, "Texas land markets posted strong price increases in 2012. Irrigated cropland markets in the Panhandle, the South Plains and south Texas as well as recreation ranches in the Austin-Waco-Hill Country region of central Texas experienced especially strong price momentum in 2012. Those markets led to the charge to an overall statewide increase of 6% over 2011 prices."
Gilliland says most areas of the state shared in the uptick in prices "except for West Texas ranchland areas and the Gulf coast area where prices were essentially flat overall. The state-wide price of $2,281 per acre compares to the 2011 year-ending price of $2,150 -- a strong increase for 2012 and a new all-time high."
Sale volumes picked up across the state, he notes. "The 5,103 sales reported for year end 2012 surpassed the 2011 volume of 4.520, recording a 12.9% increase. The level of activity has returned to volumes last seen in the late 1990s. The number of sales in 2012 was 241 transactions above the 1999 volume."
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