Steady as She Goes! Texas Land Markets in the Second Quarter of 2019

Continuing robust economic activity supported by a thriving oil industry elevated Texas land prices to $2,878 per acre in the second quarter of 2019. The expanding affluence fueled demand for recreational and investment properties driving a 5.96 percent annualized increase statewide. Typical size ebbed 18.12 percent to 1,263.77 acres, suggesting that buyers sought smaller acreages in greater numbers. The 5,559 sales fell 10.67 percent short of the 2018 volume. At $1.12 billion, total dollar volume also tailed off by 9.75 percent from 2018. However, final tallies may overcome these preliminary totals. Thus, overall statewide Texas land markets remain vigorous with sizable positive price trends. 

Statewide results reflect positive conditions in nearly every region. Based on tax-inspired investment activity, the Panhandle and South Plains watched prices climb strongly. Reflecting the strong economy, Northeast Texas registered strong growth. Continuing recreational demand for the Central Texas—Hill Country and Gulf Coast—Brazos Bottom property produced solid price growth as well. Countering these strong results, West Texas prices grew more modestly and South Texas prices remained stagnant. Far West Texas prices, where 2019 markets settled into a normal range following the stratospheric levels set during the sand mining frenzy, plummeted. Overall, most markets showed remarkable strength. 

As the summer closes, economic activity continues on a broad base across the state. Although pundits warn that the expansion, begun in 2009, must be entering its end stages, the near future shows no signs of troubling trends. While some lenders have reined in real estate loans, buyers can still find capital. Meanwhile, those participating on the investment front find it a struggle to ferret out lucrative opportunities in traditional vehicles. The scramble for returns may make land investment more attractive as a place to park capital. Though slower economic growth seems to be the consensus forecast, the Fed now appears set to cut interest rates in the coming quarters. Therefore, barring some unforeseen event such as a war with Iran, markets should continue to thrive. 


  • DR. CHARLES GILLILAND currently holds an appointment as a Research Economist with the Real Estate Center in the Mays School and an appointment as Adjunct Associate Professor of Agricultural Economics at Texas A&M University. In addition, Dr. Gilliland is Helen and O.N. Mitchell Fellow of Real Estate and a Clinical Professor of Finance teaching real estate investment analysis for the Master of Real Estate program in the Mays School at Texas A&M University.

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