The year ahead looks to be another strong one for sales of recreational and rural properties, as people continue to look for ways to leave the stress of city life behind and buy land to build a legacy with their family.
That’s the upshot from PotlatchDeltic’s annual survey of the real estate brokers in its Preferred Broker Network, who handle sales of recreational properties in six states around the country. The brokers expect 2022 sales to match or exceed the levels reached in 2021, one of their best years on record. And as was the case in 2020, the pandemic’s impact on how people live and work continue to be a positive factor in rural land sales.
“We had a lot of buyers leaving states that have tougher lockdowns and mandates,” said Kirstin Darry of Northwest Land & Lifestyle Properties, that handles land sales in north and central Idaho. “Many of our buyers were also planning for their retirement and buying land to retire on with a 5- or 10-year plan.”
Here are five other notable trends from the survey:
1. Even though recreational buyers want to be “away from it all,” they also want modern conveniences.
“Properties with good cell phone reception and internet service are desirable, since many buyers are looking to get out of the city,” said Mark Knight of Davis DuBose Knight Forestry & Real Estate, that handles land sales in Arkansas.
2. Desirable tracts sell quickly, tied to an overall shortage of quality rural land for sale.
“Buyers were aggressive in their purchases in 2021, often paying full asking prices for listings, and on rare occasions paying over asking price,” said Jonathan Goode of Southeastern Land Group, that specializes in Alabama rural land sales.
3. More rural buyers are looking to buy land for homesites as opposed to buying for a hunting spot or a place to camp.
“If a property can get year-round access and electrical, it’s going to be a homesite,” said Sean Wilson of Latah Realty, that handles land sales in north and central Idaho. “Just a few years ago, these same kinds of parcels would have been seasonal campsites.”
4. Buyers are using money from home sales, home equity lines and stock sales to fund their rural land purchases.
“Reflecting the uncertainty about the economy, people continue to look at recreational property as a good place to invest their money,” said Tom Smith of Tom Smith Land and Homes, that sells rural properties in Mississippi. His brokerage is predicting a 15% year-over-year increase in rural land sales for 2022.
5. The market includes a significant amount of first-time buyers, ranging from 10 percent to 30 percent for most of PotlatchDeltic’s brokers, though Idaho had a higher percentage.
“About 80% of our buyers were first time in the market to purchase land in 2021,” said Earl Musick of United Country-Musick & Sons Auction and Real Estate, that handles land sales in north and central Idaho. “The value of land has increased in other areas, allowing the buyers to sell and to come to Idaho and invest in more land.”
The brokers also said they continue to evolve their businesses, getting more and more sophisticated in how they show land buyers properties before they ever set foot on one. Using such tools as videos and MapRight interactive maps, buyers can get a sense of everything from the quality of tree stands on a tract to how topography changes around the site.
With continued buyer demand coupled with a strong economy, there is an overall sense of optimism that brisk sales activity will continue for the rural land sales market in 2022.
“We still feel the land buyer is well leveraged to purchase, both in terms of available funds and access to lenders,” said Brett Anderson of Close Converse, that handles land sales in northern Minnesota. “The buyer is still feeling a sense of urgency, considering the available land for sale as well as a 12-month history of escalating pricing.”
Written by Bill DeReu, Vice President of Real Estate for PotlatchDeltic, which sells recreational properties in six states – Alabama, Arkansas, Idaho, Louisiana, Minnesota and Mississippi.
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