Posted April 3, 2023

It's no secret that the pandemic has had a major impact on the real estate market. Across the United States, prices have skyrocketed as people flee cities in an attempt to escape the virus. But what you may not know is that this phenomenon is also driving up land prices in agricultural areas. In Indian River County, Florida, for example, prices have risen by 100% over the past two years. According to an article by Vero News , these are some of the reasons why:

• Real estate boom during pandemic caused agricultural land values to soar in Indian River County.

• Over 18,000 acres changed hands in the past two years & prices rose 100%.

• Buyers include farmers, homebuilders, island residents, foreign investors and hedge funds.

• National phenomenon is driving up farmland prices; this is a result of people fleeing cities, agricultural commodities being in high demand and investors wanting to hedge against inflation.

• In Indian River County, citrus decline has caused downward pressure on land value as well as conservation easements.

• Florida Power & Light has purchased 28,000 acres in 3 counties over last 5 years, helping to drive up land prices.

• Residential home market and population growth are also factors pushing ag land values higher.

To sum up, this town is just one example of how land values, particularly raw and agricultural land, have experienced a surge in demand and pricing. As the pandemic continues to reshape the economy in ways that were difficult to predict, it has caused many people to re-evaluate their priorities and lifestyle options. With urban areas becoming less attractive, many are seeking refuge in rural areas, causing a sharp increase in demand for land. Furthermore, the appeal of owning farmland, the desire to invest in a hedge against inflation, and the growth of the residential market have all contributed to the increasing demand for land. The result is a national trend of surging land prices that are expected to continue in the foreseeable future. Whether this trend will be a bubble or a sustained trend is uncertain, but what is evident is that land ownership is becoming an even more valuable asset in these uncertain times.