Land Sales Maintain Steady Pace, But Remain Well Short of Pre-Recession Peak

Developers are remaining careful on land acquisitions this time around.

Land sales can be a fickle business. Prime development sites often disappear quickly, while other parcels can languish on the market for years waiting for the right buyer and use. Land sales can also be a good barometer to show what’s ahead for development pipelines and growth opportunities within markets.

Annual transaction volume on land deals is still falling well short of the pre-recession peak that reached $31.2 billion in 2007. However, sales have been fairly steady over the past five years, with annual totals ranging between $19.3 billion and $25.0 billion, according to research firm Real Capital Analytics (RCA). Buyers have taken the foot off the gas a bit in 2019, with year-to-date sales at the end of the third quarter totaling $14.3 billion, which is down 16 percent compared to the same period in 2018, according to RCA.

Overall, developers have been much more disciplined compared to past cycles when they were more aggressively grabbing land that was well ahead of growth. “We’re not seeing that now. They’re slowly marching with growth and not racing in front of it,” saysAshley Bloom, national land & development services product council chair for brokerage firm SVN in Sarasota, Fla.

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Here’s How America Uses Its Land

There are many statistical measures that show how productive the U.S. is. Its economy is the largest in the world and grew at a rate of 4.1 percent last quarter, its fastest pace since 2014. The unemployment rate is near the lowest mark in a half century.

What can be harder to decipher is how Americans use their land to create wealth. The 48 contiguous states alone are a 1.9 billion-acre jigsaw puzzle of cities, farms, forests and pastures that Americans use to feed themselves, power their economy and extract value for business and pleasure.

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