According to the annual Florida Land Value Survey, conducted by UF/IFAS, rural land and land outside of metropolitan areas is now commonly being offered for sale at a fraction of its housing-boom cost.

“In some cases, it’s almost like a fire sale,” says Rodney Clouser, the UF professor of food and resource economics who led the survey. Some respondents reported large blocks of land being offered at 20% to 30% of their purchase price.

A population boom between 2002 and 2006 contributed to a dramatic rise in land prices throughout Florida. But now, the state’s annual population increase is expected to be only 10% of the boom years’ growth.

Transition Trends

The survey, which does not cover urban land values, showed that land outside of cities primed for development, dubbed transition land, decreased by as much as 55% in the northern half of the state.

Transition land within five miles of urban centers in the southern half of the state lost nearly 40% of its value.

However, in the one exception to the otherwise gloomy economic picture, transition land more than five miles away from urban centers in the southern half of the state increased by 5%. Most likely, this is because its low price and relative location to large cities was seen as the best deal by those still looking to buy real estate, Clouser says.

Nevertheless, the 5% increase is significantly smaller than the nearly 17% increase for the same area last year.

Ag Land Comparisions

Lagging development hasn’t just affected areas destined for shopping malls and homes. It has also contributed to drops as large as 26% in farmland values.
Although such land is typically evaluated primarily by the profitability of the crop produced, urban expansion was so rapid in recent boom years that many began to evaluate the land based on what it would bring if used for housing or other development purposes, Clouser says.

The value of irrigated cropland was $7,763 per acre in the southern region in 2008 and $5,106 per acre in the northern region (about 52% higher per acre in the southern region). The rate of decline in the southern region was 25.6%, compared to the previous year, and 23.9% in the northern region.

In 2008, the value of improved pasture was $7,862 per acre in the southern region and $4,381 per acre in the northern region (about 79% higher per acre in the southern region). The value of unimproved pasture ranged from $5,684 per acre in the southern region to $3,670 per acre in the northern region (about 55% higher per acre in the southern region). In general, the gap in land values between the southern and northern regions of the state narrowed between 2007 and 2008 because land values were down by a larger percentage in the southern portion of the state.