This article is featured in the Fall 2021 issue of Texas LAND magazine. Click here to find out more.
In the second quarter of 2021, the growth in sales volume accelerated up 43.77 percent to a total of 8,561 sales, compared to a quiet 2020 second quarter. Strong demand resulted in a shortage of listings and shot prices up a remarkable 16.29 percent to $3,433 per acre statewide. The eastern regions all experienced double digit price increases with substantial increases in the total acres transferred. Price increases in the western areas were more muted. The continued flight of buyers to safety in rural properties produced these remarkable results.
Texas buyers set a new record in total dollar volume at $2.35 billion. That total posted a 93.21 percent increase over the moribund 2020 market. A total of 685,585 acres transferred. This continues to be one of the most active periods in Texas land market history. The typical size dropped 4.78 percent to 1,176 acres.
Panhandle and South Plains: Activity moved up only 5.96 percent in this region. Prices inched up 2.99 percent to $1,172 per acre for a moderate increase. This increasing trend resulted in a 97.44 increase in acres sold to a total of 137,447 acres with a 103.34 percent increase in total dollar volume to $161.1 million.
Far West Texas: Activity in the Permian Basin oil play had driven this market for the past several years. When oil prices collapsed in 2020, so did demand for large properties in this region. The number of sales increased 12.88 percent, but total acreage fell 37.60 percent. The market focus switched from desert rangelands for energy exploration to high-priced mountain properties. So, the region posted few sales at very high prices. The lack of activity makes it difficult to find reliable pricing information.
West Texas: Sales activity increased 47.46 percent with a 1.89 percent price increase to $1,725 per acre. Total acreage sold exploded up 133.25 percent to 173,981 acres, driving a 137.55 percent increase in total dollar volume to $300.1 million. This extremely active demand should begin to push prices higher.
Northeast Texas: Volume of sales expanded 47.13 percent, pushing prices up to $5,735 per acre. Total acreage increased 47.13 percent to 89,854 acres. Rising prices and increasing acreage drove total dollar volume up 73.58 percent to $515.3 million. Markets reflect very strong demand throughout the entire region.
Gulf Coast – Brazos Bottom: The volume of sales ramped up 61.86 percent from 2020 with total acres sold increasing 30.59 percent. Price increased a remarkable 15.96 percent to $7,447 per acre. The high price and expanded total acreage produced a 51.43 percent increase in total dollar volume to $334.2 million.
South Texas: Sales activity increased substantially in the region to the south of San Antonio, increasing 53.44 percent. Prices grew 10.40 percent to $4,290 per acre. Total acres grew 86.04 percent, driving total dollar volume up 105.38 percent to $330.4 million.
Austin – Waco – Hill Country: Prices in this region soared 20.49 percent to $4,840 per acre. In addition, sales volume increased 44.93 percent, boosting total acres sold by 48.36 percent to 138,550 acres. This activity increased total dollar volume by 78.75 percent to $670.6 million.
The Future: The stampede to the countryside accelerated in the second quarter. Undoubtedly, the pandemic and urban unrest prompted this continuing quest for rural acreage. Many observers fear that market activity at these levels will not last and signs of possible cooling have appeared in housing markets. However, nothing on the horizon points to a diminution in demand for safe space in the countryside. The coming months will likely see a continuing scramble for land with increasing upward pressure on prices. The possible emerging wave of pandemic infections may inspire even more demand pressures. At some point, this feverish demand may wane, but no current developments seem poised to cause buyers to retreat.