When looking into land values in 2020, it’s no surprise that they can vary. Given the state of the current health pandemic we’re in, it only makes sense for the value of certain properties to fluctuate.
Several factors have created an uncertain market for land values such as an economy stuck in limbo and a stock market following suit, new land and trade laws, along with an unclear prediction of how the rest of this year will play out. Despite this, it’s imperative to have a good understanding of the concept of land values, especially if you’re thinking about purchasing property.
Let the property professionals at SRC Land set the record straight on the most common misconceptions about land values for sale in Texas.
#1: Land Values Reflect the Stock Market
It was once a general rule of thumb that land values reflected the stock market. Over the years, however, this hasn’t been the case. There are numerous factors that affect the value of land in Texas, including natural disasters, local and national laws, commodity prices, rate of return, and more. While the stock market can be a good indicator of what direction the economy is going, it can’t be the primary factor you turn to for verifying land values.
#2: A Higher Demand for Crops/Livestock Means Higher Land Prices
This is not necessarily true. Even when a particular crop or type of land is in high demand, there are various outside factors that can keep the value of the land from increasing.
Even the highest quality land can be hit by forces outside of the land owner’s control. For instance, if you were a landowner in the forests of East Texas and the area was deep into a drought, this could harm the land value even when the demand for forest productivity–something that would increase this particular land’s value–is high.
#3: Decreases in Land Values Mean All Land Values are Suffering
While the majority of land markets are interconnected, there are many types of land that may thrive, even while others are doing poorly. For example, a drop in hunting can lower recreational land values.
While landed used for recreational activities like camping or ATV-ing hasn’t lost its appeal or popularity on the market, it is crucial to also take hunting into account when evaluating the overall land value.
#4: There’s No Guaranteed Way to Predict if Land Values Will Go Up or Down
Looking at the state of today’s land values, it’s natural to view them as unpredictable. While this holds some truth to a certain extent, there’s one surefire way to indicate what can increase the value of a property, and that is whether people move into the specific area surrounding the land. As the population rises in a given region, the demand for land will also typically increase. This boosts the desirability and price of the property.
Let SRC Land Be Your Guide in Finding the Perfect Piece of Land
Land values can be complex. They can be tough to track, but understanding the common misconceptions about land values might give you a better idea of the value of your own land.
The best way to learn more about a property and its value would be to seek an experienced land consultant that knows the in’s and out’s of the local market while also taking the dozens of separate factors into consideration.
Don’t let misconceptions keep you from becoming a landowner. Contact SRC Land today to start your journey.