Today I received a call from a friend who had breakfast with some rural land investors. He called me for an update on what is happening in the Alabama rural land market. I crunched some numbers from our company’s sales spreadsheet and here are the trends. For those outside our market, our company, AlaLandCo, is Alabama’s largest land sales company, with a current inventory of 335 listings worth in excess of $113 Million.
The following statistics are based on our company-wide properties that are currently under contract. In an effort to paint a realistic picture of the state-wide market while not disclosing all of our sales information, I can say these figures are based on more than 20 pending transactions.
The average asking price on tracts over 15 acres that we currently have under contract is $2147 per acre. (Geographically these tracts spread from Auburn west to the Mississippi line.)
The average asking price on tracts smaller than 15 acres currently under contract is $6761 per acre. (These tracts are all located from Montgomery east toward the Georgia line.)
Average property size currently under contract: 80.01 acres.
Percentage of tracts pending that are over 200 acres: 13.1%
1. Smaller mini-farms are still selling at considerably higher prices per acre than large tracts.
2. Large tracts in excess of 200 acres are selling much more slowly than smaller properties.
3. The sweet spot for rural land is currently 40 to 100 acres, with the average selling price state-wide around $1500 to $2500 per acre depending on the location. We typically see lower prices on the west side of the state and higher prices closer to Auburn and the Atlanta market. The prices seem to be remaining higher on properties near Birmingham and close to Huntsville.
I firmly believe that properties that are priced well in the current market can sell quickly.
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