When trying to determine how much to pay for an acre of land, there are several variables that will influence the average cost of an acre around the USA.
Land in the United States is a precious commodity and there is a finite amount of it. Trying to figure out what an acre is worth can sometimes be difficult, depending on where you live and what the current market value is. There are so many things to take into consideration and you may be struggling to figure out where to start.
The average cost of buying an acre of land in the USA will be based on the supply versus demand, the location of the property, if the economy is strong, and what sort of aesthetics the land has to offer.
Just like when purchasing a home or commercial building, land prices can be negotiated and fluctuate with market trends. Understanding more about these will help you to determine if the price is fair and in line with the environment where the land is located. Having the necessary information from which an acre of land is priced will give you a sense of peace when it comes time to purchase one of your own.
I love real estate and anything that has to do with it, especially when it comes to talking about raw land. I’ve spent a ton of time understanding more about how acreage is priced in the United States, and my findings are going to help you find what you are looking for.
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What Is the Average Cost of Buying an Acre of Land in the USA?
In the United States, an acre of land is defined as just a bit over 4,000 square meters, or 43,560 square feet.
The idea of measuring land by the acre is something that dates back to the middle ages and has been used throughout history to help individuals determine where one person’s land starts and another person’s land ends. In the United States, surveyors almost always measure in terms of acreage when giving tangible size amounts to a parcel of land.
So, though the sizing is always the same, the value of what’s in those square meters or feet can vary significantly, based on several criteria. Let’s look at some of the most common reasons why one acre of land may be worth something vastly different than another acre.
1. Supply Versus Demand of the Acreage
Out of all the other reasons that an acre of land in the United States may differ in price from another one is where the property is located.
The rule of thumb has typically been that an acre of land in an area that is more populated is going to cost more to buy than an acre of land that is in the middle of an area with a more sparse population.
And it makes sense, right? Supply and demand drive much of our economic decisions and land purchase is no exception to this.
If you are looking to buy a ranch or some farmland in the middle of New Mexico, you will probably pay significantly less per acreage than you would if you wanted to buy land in a popular suburb just outside of New York City.
Anywhere that people tend to gather more will drive up the price of an acre of land.
And in areas where any sort of property is scarce? You can expect to pay top dollar, if you can even find some.
2. The Location of the Property
In addition to the supply and demand of the area you are looking at, it’s also important to take note that the overall location of the property is also going to factor into the average cost of an acre of land is going to be.
Some areas are obviously going to demand top dollar for an acre of land, like an acre of land on a popular beachfront that is surrounded by five-star hotels and fancy nightclubs.
On the other hand, an acre of land on a beach that is full of toxic waste or is quickly eroding isn’t going to be valued at the same price.
The difference here is that, just because an acre of land has the same view, it may not be worth the same amount of money.
The location of a property will also affect its price per acre when an area that used to be seen as desolate suddenly becomes desirable, either because of a now popular activity, a pop culture reference, or an exciting new opportunity that wasn’t there before.
Before oil was discovered in the state of Oklahoma, the price of an acre of land was substantially less than it was after the oil boom in the early 1900s. Ever since then, Oklahoma has experienced wide shifts in property prices, based on what is happening in the oil industry.
The acreage is the same. But, what’s happening underneath the acreage and how humans are reacting to it causes the price to sometimes shift dramatically.
3. The Strength of the Economy
Knowing what the current economy is like in the area you are looking at buying an acre (or more) of land is also very important to understanding how it’s priced and why.
Oftentimes we hear talk about the global economy and how things are going financially in our country or even the world.
But on local levels, economic health can fluctuate up or down a great deal, depending on what powers are at play in that specific state, town, or even neighborhood.
An acre of land in a city that recently had a large company lay off half of its workforce is going to greatly drive down real estate and land prices in that community.
On the other hand, an area that just found out a large and reputable industry is moving into the area may see prices of land and homes go up, maybe even skyrocket if it also means that new infrastructure – like schools, libraries, roads, and parks – are going to be built to support the influx of people who will be coming to work for that organization.
4. The Aesthetics of the Land
Finally, I would be amiss if I didn’t mention the importance of an acre’s aesthetics when determining what its average price is going to be.
Whether we like it or not, most of us are visual creatures.
An acre of land could have everything going for it… great location, best school district, close to work and entertainment but just far enough away from the neighbors. Even if all this is aligned, there will still be one issue that can determine its average price. And that is its looks.
It may sound shallow, but it’s an important part of determining a property’s overall value.
There may be an acre that has caught your eye because the price is so low, but the location is great. When you go to visit it, you realize the backyard overlooks the town’s water tower, a site that is not aesthetically pleasing.
Even for a great price, many won’t want to invest in an acre that has that view.
Whether you live in a bustling city or out in the back woods somewhere, how much an acre of land is going to cost will be determined by a whole set of factors that will be different from place to place.
About THE AUTHOR
We loved family’s outdoor adventures so much we started a land business just to help others buy their own land. We’ve sold to dozens of people from ATV weekend warriors to camping enthusiasts to retired truck drivers. Our inventory spans five western states. We’ve been trained by experience, land acquisition courses, and hundreds of hours meeting with county assessors and clerks, zoning officials, realtors, and land investors. We’ve answered hundreds of questions from people regarding the buying and use of land.Read More About Brittany Melling