A panel of Accredited Land Consultants of the REALTORS® Land Institute (RLI) shed light on the impacts of the Coronavirus (COVID-19) outbreak on land values and land market trends across the country in a recent Virtual Round Table session. The panel, which consisted of expert land agents from across the country, mostly pointed towards a positive outlook for the land market despite volatility in other areas. One key market they covered was recreational land real estate.
Justin Osborn, ALC, out of Durango, CO, who is with the Wells Group Durango said he is "definitely seeing an increase in demand for recreational properties." For example, he “had three properties that had been on the market for over a year and all of them went under contract the first week of March.” He expects there are a lot of buyers out there “just looking to get away with all the sports clubs shutdown, the recreation centers shut down, and people just can’t get out to spend time as a family recreating like they were able to before all this started.” This is already being reflected in the market as “demand for recreational land has actually gone up,” at least so far in the early days after the outbreak and shutdown.
While the demand has gone up, the interesting thing that Justin pointed out is that many of the recreational tracts being purchased are on the smaller-side, as opposed to larger more expensive parcels. This means that many buyers in the market right now are turning out to be potentially first-time land buyers or middle class buyers looking for a refuge to camp and "hunt to fill their freezer." In his opinion, "We’ll probably see a small uptick, less than 5%, in the small parcels." He said he doesn't "see those depreciating, at least right now."
The bigger parcels, especially in the millions of dollars, he noted that "there’s still a lot of inventory of those. I don’t see those larger ranches doing quite as well, especially the ones that are overbuilt… those I’m afraid could get pretty hard [to sell].” He noted, though, that the depreciation of those larger ranches though should be more of a short-term hit that will eventually correct in the longer-term.
Overall, Justin is predicting "a lot of opportunities, even for the average Joe, to get themselves into a recreational property."
For more insights on the impacts of the outbreak and shutdown on the ranch land market for ranchers from Clayton as well as insights on how other land markets are being impacted, make sure to watch the full Impacts of COVID-19 on The Land Market Virtual Round Table presented by the RLI 2020 Future Leaders Committee or check out the related posts below:
If you are interested in buying, selling or investing in land real estate, make sure to Find A Land Consultant, like an ALC, in your area with the expertise needed to best assist with your transaction.
About: Justin Osborn, ALC, is a licensed associate real estate broker with The Wells Group. Justin is a member of the REALTORS® Land Institute and serves as Chair of their 2020 Future Leaders Committee.