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LOOKING AT RURAL: HOW COVID-19 CHANGED THE LAND INDUSTRY

The year 2020 has proven to be a year of great uncertainty, and when there is great uncertainty, people tend to rediscover what is of lasting value. For this reason, it should not surprise anyone to witness the rising demand for land, particularly for rural land, following the pandemic outbreak in North America.

Availability
In the past, rural land was an investment option mainly available to high-income families. Today, one can safely say that holding rural land has become increasingly within reach of individuals from all walks of life due to smaller parcel options becoming more available. For example, in an area where the traditional median parcel size was 100 to 200 acres, we are now seeing the demand being filled for smaller parcels that may range from 10 to 50 acres.

Migration From Cities
People are drawn to rural land because of the opportunities the land offers to take a literal and figurative breath of fresh air away from the turmoil and COVID-19 angst of urban living. During the stay-at-home orders across the country earlier this year, many city dwellers started visiting public land, such as national parks, more frequently. However, when the public parks began to shut down because of overcrowding concerns, those individuals realized that they wanted to have their own property to escape to.

In general, we’re seeing more people looking for a place to relax and unwind from the hustle and bustle of the city. Some are interested in having a place to get away to on the weekends, while others are looking for a place to possibly move to permanently. From what we’ve seen, this has always been the case, but the need for more space and tranquility has massively increased this year as a result of the pandemic and new workplace flexibilities that allow employees to work remotely. So, whether someone is looking for a weekend retreat or a place to relocate, the demand for rural living is significantly higher.

The decision to move to suburbia is not only being made for a lifestyle change, it’s also being made as an investment. Land will always come with less volatility, offering a safer and more sustainable path for the growth of personal wealth. It stands the test of time and, traditionally, never takes a big leap year over year, making it a stable, long-term investment. Additionally, as the demand for smaller acreage increases, the opportunity for a greater return on investment for larger acreage investors becomes more prevalent.

In 2018 and 2019, we saw very healthy markets, and 2020 appears to be no different. Time on the market is always a good indication of that, and we’re seeing properties on the market for considerably shorter times than they were a year ago.

Modern Technology
Next to time on the market, another part of the sales process has changed as well: how people inform themselves about the land they are considering for purchase. People are wary of taking lengthy treks to visit land and meet land specialists — although it needs to be said that a great many deals are struck on the bed of pick-up trucks, which are conveniently about five feet wide and help facilitate social distancing guidelines — so they rely more heavily on technology to inform their buying decisions.

Our proprietary, interactive virtual tour technology Land Tour 360 makes it easy to discover properties without setting foot on them, and it has been used considerably more often in the last few months than previously. We also notice that buyers are making extensive use of the information on the value of land that is available online using tools like LandBase, our geographic information system (GIS) land-mapping system which catalogs land data in extremely detailed ways.

The result is that, ironically, while land buyers are reverting back to investing in assets that have proven their enduring value for a great many generations, they are discovering and making extensive use of modern technologies to inform themselves about those assets.

Jason Burbage
National Land Realty
7002 Pelham Road, Suite M
Columbia, SC 29615
jburbage@nationalland.com

 

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