June 01, 2015 — Austin
Small land sales throughout Texas posted double-digit growth and average price per acre showed strong increases statewide last year, according to the 2015 Texas Small Land Sales Report released today by the Texas REALTORS®.
Scott Kesner, chairman of the Texas REALTORS®, commented: “Land is a hot commodity in Texas. The demand for Texas real estate and the competitiveness of the market are as strong for small land sales as they are in the residential housing market. Land for weekend getaway homes, ranchettes, and hunting continues to grow in popularity across the state as the Texas economy continues to prosper, particularly in areas surrounding Texas’s major metros.”
According to the report, 5,282 small land tracts were sold in Texas in 2014, a 20.69% increase from 2013. This double-digit growth was consistent across all seven regions, with the exception of Region One (Panhandle and South Plains), which decreased 7.93% to 116 small land sales in 2014. For the second year, Region Seven (Austin-Waco-Hill Country) showed the most small land sales of any region, with sales increasing 19.16% to 1,722 small land sales during the same time frame.
The average price per acre for Texas small land sales also showed strong gains in most regions in 2014, increasing 3.5% year-over-year to $5,018 per acre statewide. Regions Two (Far West Texas) and Five (Gulf Coast-Brazos Bottom) were the only regions to show decreases in price, falling 47.24% to $1,635 per acre and 0.31% to $9,167 per acre, respectively. Region Five also had the highest average price per acre of any region.
Median tract size, conversely, decreased slightly across the state as strong demand for Texas real estate continues. While the statewide median tract size remained constant at 20 acres, most regions showed decreases in median tract sizes between 3% and 10% in 2014. The exception was Region Two, in which the median tract size grew 54.16% to 120 acres during the same time frame.
Charles Gilliland, economist with the Real Estate Center at Texas A&M University, added, “Historically, the Texas land market has been closely linked to the performance of the oil and gas and agricultural markets, but right now that’s not the case. Oil, cotton, and corn prices are significantly down, but small land sales in Texas remain robust and in high demand.”
Due to the significant physical variations among the seven regions, the definition of a small land tract varies from approximately 30 to 160 acres in each region. The exception is Region Two, in which 500 to 8,000 acres qualifies as a small land sale.