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The Most (and Least) Expensive Land Real Estate in America

The price of land varies wildly across this great nation. In some areas, land real estate can cost millions of dollars per acre. In other areas, land is being given away for free. What’s truly baffling is that in many cases, the two types of land are only miles apart. What makes some land worth millions and other land worth next to nothing? Let’s take a look at the most and least expensive land real estate in America.

Most Expensive Residential Land Real: Atherton, CA

This town has the most expensive land real estate in the entire country. An empty lot in Atherton costs more than a home in San Francisco. According to curbed.com, vacant and residential land can go anywhere from $6,750,000 to $6.9 million, and that’s not even counting the price of a house. A 1.43-acre property was recently sold for a whopping $6.9 million.

A great location and a scarcity of available land are the main reasons Atherton land is so pricey. The town is located forty-five minutes south of San Francisco and less than twenty minutes away from major tech companies in Silicon Valley. Add in the fact that there is only a limited amount of land available in the area, and you’ve got properties that will continue to skyrocket in price.

Most Expensive Farmland: Rhode Island

The smallest state has the biggest prices when it comes to farmland. The U.S. Department of Ag reports that farmland in Rhode Island is priced at an average $13,8000 per acre. New England states tend to have more expensive land real estate, but why does Rhode Island have land prices almost triple some other states?

Similar to Atherton, the main draw to Rhode Island farmland is location. It is close to many big cities, which allows farmers to save thousands on transporting their produce. Thanks to this, farmers are also able to sell their produce to stores for a lower price than far-away farmers.

Least Expensive Residential Land Real Estate: Marquette, Kansas

This land goes beyond cheap. It’s free! According to the town’s official website, “The community of Marquette, Kansas, is offering free building lots to interested families who are looking for an extraordinary small town.” The only requirements are building a real home on the land and living there for at least a year. It’s like a modern-day Homestead Act.

The reason for the free land? The 2008 real estate crash stunted the town’s real estate business. No one had the resources to buy or build a new home. The town hopes the offer of free land will bring more people, businesses, and cash flow back to Kansas.

Marquette boasts a low crime rate and a low cost of living. However, the town does lack what makes Atherton and Rhode Island so desirable. The town is very remote, which can lead to problems finding a job.

Interested in applying for free land in Marquette? You can apply for land here (http://www.freelandks.com/availableland).

Least Expensive Farmland: New Mexico

You might be surprised to learn that this state has the cheapest farmland in America. New Mexico has a sunny, warm climate that would seem perfect for growing crops or raising livestock. However, it’s the desert heat and dryness that drives the prices down. The U.S. Department of Ag reports that farmland in New Mexico is priced at an average $530 per acre, a fraction of what Rhode Island farmland is priced at per acre.

The Land of Enchantment state can be perfect if you are growing foods that flourish in heat and dry weather, such as asparagus, cantaloupe, snap beans, and many spices. If your crops require lots of water, you might want to look elsewhere. The cost of irrigating some properties could be more expensive than the land itself.

Scarcity of land and location are the two most important factors when it comes to the price of land. Two properties in the same states can be priced at wildly different figures depending on how much land there is, how much demand there is, and the location of the land. To make sure you are getting the best price for the land you are selling or buying, be sure to use an expert land real estate agent.

Looking for land? Check out properties on the market from the industry’s top land real estate agents using RLI’s Land Connections property search tool.

 

About the author: Laura Barker is Marketing Assistant Intern for the REALTORS® Land Institute. She graduated from Clark University in May 2017 and has been with RLI since October 2017.

Investing in Land Real Estate for Retirement: What You Need To Know

Choosing how to save for retirement can be a decision that takes years. After all, that’s the money that you’ll be living on during your golden years. Most people stick to 401ks and stocks, but what many people don’t know is that you can invest in land real estate to save for retirement. Investing in land real estate can be a great way to save money long-term, but with any investment, you need to know what type of land to invest in, what sort of returns you can expect, and what to avoid when investing in land real estate.

There are many benefits to investing in land real estate. One benefit is that if you invest in land in different areas, you will be protected if certain properties are hit by natural disasters or the value of one type of land real estate drops. Geographic and commodity diversity can keep your money safe even in a rocky market. Another benefit is that land real estate (farmland in particular) sometimes have higher returns than stocks do. Most stocks can be expected to produce a six to seven percent return over time), while farmland has produced a steady 11.5 percent annual return over the past twenty five years.

If you are looking for a low-maintenance investment, vacant land is a great option. It is cheaper to buy than developed land, and you don’t need to spend money doing repairs or renovations. While this is an excellent investment to make in the long-term, you will have to be patient. This investment will take time to make money. You’ll also want to keep an eye on the market to make sure you’ll be able to sell it at the best possible price. Consider looking into vacant land properties in areas that are seeing an increase in population or jobs. This land will is likely to become more desirable over time, and you’ll be able to sell it at a higher price than what you bought it for originally.

When investing or buying vacant land, you should always know who you are buying from.Be careful of people who have only owned the land for a short amount of time and seem very eager to get the land off their hands. Vacant land takes times to accumulate value, so it’s suspicious if people only own it for a short amount of time. The owners might know something about the land that makes it less valuable. This is a perfect example of why it is so important to find an agent with the expertise and experience needed to conduct land real estate transactions – like an Accredited Land Consultant (ALC).

Timberland or forestland are also excellent long-term investments. The returns for timberland real estate tend to move counter cyclically to other markets.  Because of this, it will add portfolio diversification, lowering the risk of losing money. Timber is also a hearty crop that can provide you with returns for many years.

You should invest in timber or forest land only if you are planning to retire ten or more years down the road. You’ll have to spend money to plant trees and won’t get returns as they grow, but once the trees reach maturity, they will provide steady returns.

Although investing in land real estate to save for retirement is an excellent option, there are some key factors to look out for. Keep the following in mind while you look at different properties:

-You need to know the land inside out. You need to know everything about the land you are investing in. This means zoning, mineral rights, any environmental hazards on the land, usage restrictions, access easements, taxes on the property, and the likelihood of natural disasters in the area. If you think you are asking too many questions, you are not. Even small issues can end up costing you a lot in the long term. For example, you could have an incredible property with full mineral rights, but if the soil drainage is poor, the value of the land could drop so dramatically that any other positive factors wouldn’t matter at all. Finding an ALC near you can help ensure that you see the whole picture when it comes to investing in a piece of land.

-You need to be crystal clear on the taxes. This was mentioned in the previous bullet point, but it’s so important we added it again. Some properties have taxes that are so high that the taxes eat up any returns you make on the land. Speak with your land agent about this and make sure you understand what your costs will be before investing in a property.

-Are there wetlands on the property? Thanks to Waters of the US (WOTUS) and other laws, if you have wetlands on your property, huge parts of your land might not be useable. This could cause the value of your land to drop dramatically.

Investing in land real estate can be a great way to save up for retirement. Land real estate is a valuable and limited community that, historically, continually grows in value. If you do your research and spread your investments out over a few different types of land, you could have a successful start to saving and creating a well-balanced, diversified portfolio for your retirement.

About the author: Laura Barker is Marketing Assistant for the REALTORS® Land Institute. She graduated from Clark University in May 2017 and had been with RLI since October 2017.

Is December Really the Worst Month to Sell Land Real Estate?

Many people think December is the worst month for selling land real estate. There is some truth to that: families tend to want to let their kids finish the school year before moving, the holidays mean people will have less free time to tour land real estate properties, and bitter weather might keep potential clients from making the drive out to available properties. Don’t let this assumption make you think that your sales will be at an all-time low this December though. Depending on what type of land real estate you sell, this could actually be one of your best months! Let’s take a look inside the rumor of December being the worst time to sell land real estate and what it means for your business.

The idea that December is the worst month to sell land real estate originally comes from the world of residential real estate. Urban, suburban, and rural residential REALTORS® noticed a sharp drop in sales in December, especially closer to the holidays. These residential REALTORS® accredited this seasonal slowdown to a few different factors: potential clients were waiting until the New Year to make a big purchase, people didn’t want to be constantly showing their house on top of all the holiday stress, and the people that did want to buy a house in December usually had very specific needs. It’s become such a popular saying that many land agents believe it applies to their business as well.

While there are some similarities between land and residential real estate, the two fields have very different needs from their clients. Residential real estate is more focused on the client’s personal connection with the property, while land real estate tends to focus on how profitable the property can be for the client. This is a huge factor into why December can be difficult for residential real estate agents while land agents might not notice any dent in their sales. Instead of being tied to the individual needs of a client, land real estate sales are more impacted by the trends and needs of the market.

The good news for land agents is that if you have an eye on the market or have been in the business for a long time, you’ll already know what your clients want before they do. The need for timberland land rises significantly in autumn, and the sell for big game land real estate goes up as hunting season draws near.

So, is there a best and worst time to sell land real estate? While rural land real estate is less restricted by monthly ups and downs than residential real estate, there are some factors that can impact the sales. There are natural dips and rises due to what the market needs. So, while there are better and worse months for the land real estate market, the difference between them is much less severe than many people think.

If you are still conflicted about selling your land property in December, here are a few surprising benefits to consider:

Less Competition. Since many people believe that December is the worst month to sell, land real estate agents might prefer to dedicate more time to holiday festivities instead of reaching out to new clients. This means there are more potential clients and sales for you!

Making the Drive Can Make The Sale. Bad weather, snow, and ice can tempt many land agents to stay home instead of making the long, difficult drive out to properties. Being willing to drive in rough weather can lead you to a greater pool of clients. Before you hit the road, be sure your car is fitted with the proper tires for rough roads.

The Psychological Appeal of Christmas. What lowers the residential REALTOR®’s sales might actually work to your advantage. With the holidays and New Year’s Eve on their minds, people’s thoughts naturally turn towards the future and their families. People in urban areas can consider moving to the countryside to raise a family, and rural land owners might invest in more land real estate when looking at diversifying their portfolios for the New Year.

There are many factors that play into how successful a month is for selling a property. Success depends more on the needs of your clients than what month it is. If you keep up-to-date on the needs in your community and your market, December can be a great month for you.

Land Real Estate Professionals Prepare for Foreign Land Investments As Britain Leaves the European Union

June 24, 2016 (Chicago) – Analysts are scurrying to predict the impacts of Britain leaving the European Union on the global real estate industry. The Realtors® Land Institute has released a statement on its effects on land investment from Lawrence Yun, Chief Economist at the National Association of Realtors®, stating that “The U.K.’s decision to leave the European Union breeds both opportunity and uncertainty for the U.S. housing market. Demand for real estate and land could rise if foreign investors view America as a more secure place to do business and borrowing costs become even cheaper. On the other hand, if instability in the financial markets persists and a global economic slowdown occurs, the U.S. economy would also slow, in turn impacting real estate land investment and demand. Finally, the British demand for U.S. real estate would soften from the weaker currency.”

The REALTORS® Land Institute says it is still uncertain how ‘Brexit’ will affect land real estate markets long term but it is important for real estate and land professionals to be prepared to handle an influx of foreign investments in land during the coming months. The Institute recommends all real estate professionals should prepare and know where to find a land consultant in case they are approached to assist in a land real estate investment transaction.

The 2016 Realtors® Land Institute President Bob Turner, ALC, explained that “With the recent volatility in the US stock market, investments in productive farmland, ranchland, and timberland are considered as safer alternatives to stocks because of their income return and stability. Between the increase in demand from US investors and, now, the increase in demand that could come as a result of Brexit, Accredited Land Consultants and other professional members of the Realtors® Land Institute are prepared to welcome the opportunity to use their knowledge and experience to assist investors.”

National REALTORS Land Institute LogoAbout the Realtors® Land Institute
The Realtors® Land Institute, an affiliate of the National Association of Realtors®, is the prestigious, higher learning professional membership organization for practitioners who specialize in land real estate transactions. Over 100 years old, the Institute provides a wide range of programs and services that build knowledge, relationships, and business opportunities for the best in the land business. The REALTORS® Land Institute (RLI) provides the education, tools, services, advice and networking opportunities that are the foundation for all land professionals to become the best in the business—to become an Accredited Land Consultant (ALC). For more information, visit rliland.com or call 800.441.5263.

5 Ways to Maximize Your Listings

This article was originally featured in the 2016 Summer Edition of the Institute’s Terra Firma Magazine.

I have seen a lot of amazing property listings under-perform or flat out fail from a lack of understanding how to best represent them online. Most of these tips apply to advertising property in any medium- digital or print, but will serve you particularly well online. In our increasingly digital world, there is a lot of noise that can drown out your listing, but with these easy steps, you can stand out and drive buyer interest and leads like never before. Here are my top five tips for how to maximize your online property listing.

  1. Completing Everything
    It should go without saying, but a complete listing and profile is essential. The property should be mapped accurately; titles and descriptions filled out completely; a generous number of photos uploaded; but also, pay attention to the smaller stuff. Things like categories and property types can have a big influence on who sees your property and where it shows up in searches. Often these modifiers work as filters, so if your farm isn’t tagged as a ‘farm’, it won’t show up in a ‘farm’ search. You could be missing out on a massive amount of property searches by leaving these blank.Same with property features like house size and bedrooms. Even if it isn’t the property focus, some buyers will be happy to know there is a habitable structure on the property. Water availability, utilities, property access, proximity to a town, etc. should be addressed if not obvious, and often even if it is. At a minimum, when there is a text box to fill out or drop down to select while creating your listing, you should be entering information into it.
  1. Picture it
    You want your listing to impress the pants off of people, no matter the property. The best way to get an initial response is through great photos. You generally see a two to three times greater response rate from listings with professional photos because they capture people. I’ve seen a weedy lot with a decrepit structure transformed into a landscape you would want to hang on your wall. You don’t want to deceive buyers, but you do want to represent it in the best possible way. If a professional photographer isn’t in your budget, read up on how to take better pictures. All photos should include a focal point such as a structure, fence, tree, lake, livestock, or even a flower. Look at your photos. If you don’t like your photo, neither will a buyer.The technology landscape is changing. Aerial photography and video is becoming more common thanks to drones. 3D tours and street-view technology has made its way into real estate. Mapping technology can orient you to the property terrain and features. All of these technologies are improving the way we tour a property remotely and adding some flash and excitement, but really it is about experiencing the property through a computer or mobile device as if we were physically there.
  1. Reading vs. Experiencing
    The title and description of a listing are nearly as important as photos because they frame the image of the property and fill in the gaps. Think of the photos and title as a hook, and the description as a line- you aren’t going to catch a fish without both.The title should be descriptive and evocative at the same time. The interested buyer isn’t physically at the property, so they need to experience it through your words and photos. What are the properties main features or resources? ‘Elk hunter’s paradise’, ‘mountainous’, ‘vistas’, ‘wilderness’, ‘fertile’. What does the property ‘feel’ like? Use descriptors like: ‘tranquil’, ‘remote’, ‘vast’, and ‘sweeping’. Be creative and come up with your own that fit the property. These words will help form an emotional connection with buyers beyond just seeing a piece of land. Use language and phrases that will resonate with your intended buyer to help them experience it from their computer.Similarly, the description should tell a story. Include all of the essential details–structures, acreage, crops or resources, and make these clear, but go beyond that. What is the history of the land? Who owns it now, and what is their story? What improvements have been done, and why? You want the buyer to care about this piece of land, and a story makes it special (even if it isn’t a very good one).
  1. Forming a Connection
    Not only do you want the buyer to care about the land, but you want them to care about you as well. Establishing trust and conveying confidence up front goes a long way to obtaining a lead, and ultimately securing a deal. You are your brand and vice-versa, so it should be treated and promoted like you would promote yourself. Your logo or photo should be everywhere you are; it shows people you are present in the region and an icon in the industry. The more they see it, the more they will feel you are an established and trustworthy business. Not unlike building a reputation within your community, your reputation and brand online are important to your business.A profile photo and bio can form a further connection. People will recognize you, and may even feel as if they already know you. You are no longer a faceless entity; you are a person, just like they are. If there isn’t a place for this on your listing, add it to the description.
  1. Get it Seen
    You have created a place for the information, now you need to drive people to see it. Post it on social media, add it to your website, print off some flyers and pass them out, pay for a featured ad, send some emails. Promoting the listing is the single biggest contributor to any listing’s success.It is also helpful to review your listing performance to get an idea how many people are seeing your property, and what actions are being taken. Give it thirty days, then take a look at listing views and lead count. These numbers can be helpful in telling you what the interest is like for your property. High listing views means that you are promoting it well, or it is popular in searches. If you are getting lots of leads, then you are doing well, but pay attention to the quality of those leads. Are they just kicking the tires, do they lose interest, are they responding to your attempts to contact them? These could be indicators that you are getting the wrong kind of traffic, appealing to the wrong audience, or potentially misrepresenting the property.

Take Away
To follow up, your property listing should have all of these qualities to reach maximum potential and performance:

  • Fully Completed Listing – Check all the boxes and enter all the information
  • Transport the potential buyer to the property with your words and photos
  • Convey an emotional connection, tell a story about the land
  • Establish trust and form a connection
  • Promote like crazy, and monitor listing performance

Online property advertising reaches a huge audience, and expands the buyer pool to include the entire country, or even world. When used correctly, it can be the most effective property selling tool in your arsenal. Implementing these tips will allow you to maximize your property listings, and lead to more deals closed in less time.

Jean Paul LaCountJean-Paul LaCount was the Head of Marketing for Lands of America and Land And Farm, and has been a digital marketer for the last 12 years.

Working with Efficiency on the Road

How much time do you spend in your vehicle during the work week? What about the average amount of time you spend in your vehicle during a growing season? Don’t forget the commute to and from work. If you tally it up, you might be shocked or perhaps a little horrified at the answer. Then comes the next level of questioning: What do you do with yourself during that time? Are you prepared for what might be waiting for you on a dusty dirt road?

These latter questions were posed during a recent ALC-to-ALC teleconference that I co-hosted with Jeramy Stephens, ALC, from National Land Reality out of Stuttgart, Arkansas. These questions lead us many different places but for me personally, it comes down to efficiency. I have a thirty-five minute drive to and from work on top of wherever my job takes me during the business day. I have been intentional about developing habits that allow me to be productive during this time. This seventy minute minimum of car time has become a valuable part of my work day. Here are some tips that might help you achieve greater efficiency:

  1. Get started on the go. If you have support staff, then I recommend a Dictaphone or other recording technology. I try to dictate at least 2-3 emails/letters every morning on my way to work. These communications can range from crop reports to land inquiries – you name it. Just this very morning I dictated a letter highlighting crop inputs that need reimbursed at an upcoming closing, contacted a neighbor about a property for sale and sent a “feeler” to an owner in Missouri who has underutilized land near a management account of ours in Greene County, Illinois. Each of these things needed to be done. Why not do them while I am sitting in the car?
  2. Plan calls accordingly. We all obviously spend a lot of time on the phone in order to do our jobs well. Some calls need to be made while sitting at the desk so we can access folders, spreadsheets and computers, but there are also calls that can be made anytime, anywhere. I categorize my calls. If I don’t need to reference something at my desk, I save it for when I am in transit going home, to a closing or checking on crops across West Central Illinois.
  3. Be prepared and communicate with your co-workers. If I am going to be scouting farms in Morgan, Scott and Greene counties, then I make sure I have all three of those plat books with me, either in paper or electronically. You never know when you might get a call to check something out while already on the road. If I am going to a county seat, I always ask my co-workers if they need anything while I am there. If I spent all morning near Carlinville, Illinois (1 hour away) it would be discouraging to get back to the office and hear Dad say, “Not sure when you’re going to Carlinville, but the next time you’re there I need something from the courthouse.” Kill multiple birds with one stone and help each other limit needless travel.
  4. De-Compress. This might sound contradictory to previous points, but we all reach a point on certain days where we are fried. We are tired and desperate to chill out a bit. I use the “Pocket Cast” app to download my preferred podcasts. It allows me to quickly filter and download podcasts that interest me. I can go from economics to sports to my own personal nerdy interests with the click of a button (nerdy interests shall go unnamed). As much as I love podcasts and music, I also find it reinvigorating from time to time to simply turn everything off and sit in the silence. Silence is hard to come by at work and I certainly don’t get it at home with sons ages one and six!

Jeramy did a great job on the ALC teleconference call highlighting certain technology he uses to stay plugged in and there is a wealth of articles out there on smartphone apps that help in all sorts of ways. He also mentioned his truck being a traveling convenience store full of emergency and convenient items. He spoke on it better than I can write so I highly recommend you take some time and listen to the recording which can be heard here.

The long story short is that we as professionals in the land industry are on the road a lot. We can’t afford to mindlessly hit seek on the radio over and over. Tweak your tasks that need done to fit your travel schedule. You can get more done and become more efficient in the process. Be prepared. Take the time to think through your day before jumping in the car or truck. Do the preparation that has you ready to tackle the day and adapt on the fly. Do it safely and do it efficiently.

Luke Worrell, ALCContributor Luke Worrell, ALC, Worrell Land Services
Luke Worrell, ALC, is a Broker and Accredited Farm Manager in Jacksonville, IL.  He specializes in agricultural real estate and land management in west central Illinois.  Luke enjoys all things sports and traveling.  He resides in Springfield, IL with his wife Allison and two sons Kale and Benson.