Rural Acreage near Austin as Investment (Spring, Paris: transplants, for sale, how much)

[Raskolnikov]

I've been researching buying raw rural land, possibly 20-80 acres or more, as an investment, as a place to basically park money and allow it to grow. The idea would be to sell it much later- perhaps leave to my kids, or sell in about 30 years. I've been looking in Central Texas (Round Top, Brenham, Giddings, Flatonia). For comparison I have also been up to north east Texas -- 5 hours from Austin --and looked up there. (near Paris and Sulphur Springs/ Mt. Vernon/ Winnsboro).

I am amazed at how much more expensive land is in Central Texas. Roughly, it seems to be going for between 8K an acre up to 15K per acre and sometimes much more. If you want hardwood trees on it, or a creek or pond, it will be even more. In northeast Texas land is between 2K and 5K.

I'm wondering if, in general, land down here is a bad investment. It seems that land values here have substantially fall to far, whereas up north, it's already so cheap that it can't get much cheaper. I suppose land is more scarce down here, but at the same time should it really be this expensive? Or is this just a residual effect from the boom times of Californians moving to Central Texas in the early 2000's... And will all of that end and land prices fall hard? Does anyone have any opinions on this?

[TexasHorseLady]

I know of land in the Central Texas area for MUCH less than that per acre - but it's closer in to Austin (the towns you're mentioning are on the very outskirts, if that, of Central Texas). Of course, land closer in to Austin is more likely to increase in value, too, depending on if its in the growth path (which at this moment appears to be east/southeast and southwest, with some heading north towards us in Jarrell, but I wouldn't promise which way the wind will blow in future, under the current economic circumstances).

[Raskolnikov]

hmm. I wonder why land out there is so expensive? (Round Top, Smithville etc.)

[TexasHorseLady]

Well, Round Top is sort of an artist's community, so that runs the price of land up.

Smithville, land is more expensive if it's got river frontage, of course - I just did a quick MLS search and found quite a few that were in the $4,000-5,000/acre range, with some WAY more than that. The ones that I looked at that were way more than that appeared to be being sold for commercial land, so it's likely location.

Until a couple of days ago (and it may still be available, they just pulled it off the market for a while), I had a listing north of Thorndale that was 64+/- (almost 65 per tax records) acres for $240,000. With water to it, ponds, creek, beautiful piece of property (if I didn't already have mine, I would have bought it). That works out to about $3600 an acre, and there's property for less per acre in that area.

Checking Caldwell County, there's quite a few for sale for between $2-5,000/acre. Llikewise Milam County.

Now, all of these are raw land, no buildings. Some have wells, some need wells, some have access to city or private water company water.

But there's no shortage of land in that price range within a reasonable commute of Austin.

[HappyTexan]

If you are looking for land for investment and growth then you should study the county and it's potential for growth.

IMO land prices did go up in the past couple of years in the outlying areas of Austin which I think was driven by transplants. Subdivision builders were going north and east of Austin buying up farmland for expansion. But that has pretty much slowed to a crawl if not an outright stop.

I've been watching land prices in Milam and Robertson counties for the past year and they are starting to come down. A few properties re-appear at lower prices as well. There are good deals that come up and are sold quickly too. The Alcoa plant in Rockdale (Milam county) shut down and that is and will have an effect on prices.

So, I guess I'd suggest that you take your time looking; keep watching what's for sale and what get's sold to get a feel for what the right price is that makes a property move. Also find the local papers online and read them for what's going on in the county.

[HappyTexan]

Originally Posted by TexasHorseLady

Until a couple of days ago (and it may still be available, they just pulled it off the market for a while), I had a listing north of Thorndale that was 64+/- (almost 65 per tax records) acres for $240,000. With water to it, ponds, creek, beautiful piece of property (if I didn't already have mine, I would have bought it). That works out to about $3600 an acre, and there's property for less per acre in that area.

I think I know which property this is..along Alligator Creek off 486 (forgot the CR this is on) ?

That's been listed for almost a year and was at a higher price and then lowered if that's the same property that I've been following.

[TexasHorseLady]

It was. Originally it was the house and 95 acres, then they pulled the house and 31 acres off the market to do some work to the house. Now they're just pulling it off for a while (drought, winter, doesn't make for pretty showing even though it's a wonderful piece of land and still has water in the ponds and part of the creek, even so - like I said, if I didn't already have my piece, I'd seriously consider it myself).