According to a new study done by the Texas Real Estate Research Center (TRERC) at Texas A&M University, the volume of rural land sales has fallen 26.5% from mid-2021 to mid-2022.

“Clearly activity appears to be slowing,” TRERC Research Economist Dr. Charles Gilliland said. “Demand for land, as reported by rural brokers, remains strong but has noticeably cooled from last year’s frenzied contest.”

Below-asking-price offers have returned in some markets, which haven’t been seen since the third quarter of 2020. While there are fewer properties for sale now in the second quarter of 2022, prices have increased by 24.5% to $4,286 per acre statewide.

The volume of total second-quarter dollar sales has hit $3.6 billion, up 28%. In the first quarter of 2022, the rise was 76.7%, followed by a 97.6% increase in the fourth quarter of 2021.

“A total of 850,469 acres changed hands, up only 3.67% over 2021, suggesting market activity has fallen to a more normal level at high prices,” said Gilliland. The typical transaction expanded 9.4% to 1,293 acres.”

Prices have increased by more than 21% statewide, except in Far West Texas where prices dropped substantially. While the total acres transferred has declined in several regions, and sales have fallen everywhere, Far West Texas still has a high amount of sales.

“This trend toward rising prices and declining activity suggests demand is dropping,” said
Gilliland. “If so, brokers may begin to find ebbing enthusiasm among potential buyers.”

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