How’s the health of the ranch market in Texas today?
It appears to be on a positive upward trend, and according to many brokers and title companies, they are busier now than they’ve been in years. It seems buyers are making their move in all areas of real estate in the Texas Hill Country including single family homes, development tracts, and recreational ranches. Many believe it’s an indication that investors and end users now believe that real estate has bottomed and may be on the verge of making upward price moves. In addition, in Texas, there’s a lot of new oil and gas wealth due to the recent discoveries and changing technologies that have spurred the industry in places like the Eagle Ford shale.
There’s actually a shortage on high quality premium Hill Country ranches as the inventory has been significantly reduced. Many of the higher end live water ranches in highly sought after areas near Austin and San Antonio have been purchased in the last year, and it’s becoming more difficult everyday to find a quality Texas Ranch for your prospective buyers. In one actual case, I recently saw a high quality prime Hill Country live water ranch come back on the market when a contract fell through, and within a couple of weeks the ranch was back under contract. There were actually 3 different buyers that were interested in the property at the same time, and the seller received two different offers within days of each other. The accepted offer was nearly a full price offer, and the buyer felt very fortunate to be the one that was able to purchase the property.
If this trend continues, expect Texas Hill Country ranch prices to spike at some point due to the lack of supply and ever continuing increasing demand for these kind of recreational ranch properties. However, while demand for the highest quality Texas ranches spikes, for ranch properties that don’t meet the high quality standards, there continues to be less interest than in the more quality ranch properties. It seems the buyers are very discerning, and while they’re willing to pay a premium for high quality ranch properties, properties that don’t meet those quality standards continue to languish to some degree.
Where does the market go from here?
Many expect prices to begin climbing as inventories diminish and as we may actually see some shortages driving prices even higher. The indications we are seeing is it’s a good time to buy because don’t expect the ranch prices to come down, and it’s getting harder all the time to find those one of a kind properties.