Seattle Bubble Forum Archive

With all the talks about houses tanking, how about land? What has been the observation about land outside zoning areas? Are they dropping at a much faster rate than houses? Any data or thoughts on lands outside zoning areas?

I read an academic paper a while back that said land prices have 3 times the variability of housing prices. If you believe that, than land is falling faster than housing.

Anecdotally, on the national level the builders are madly trying unload their land, and are walking away from their options.

Locally, just take a look at the prices for 1 acre+ lots outside of Redmond.

This listing is worth a thousand words:
http://www.redfin.com/WA/Redmond/21201- ... s-28021472

3 acres, a beautiful house, an $85,000 haircut from 2006, and still sitting.

Land is valuable when developers want land. It's usually not valuable when they don't. Again, basic supply and demand at work. Right now, the developers have acquired too much land and there are not enough buyers to buy it after they develop it. This is how the little guys get pinched. They make money when the market is good, so they buy land...then the market turns and they are stuck.

What's interesting is that when I am doing work with Habitat, markets like this one are best for us to find land to build on because there isn't much competition. Rather than beating the bushes trying to find anything we can build on, we have people approaching us wanting to sell whatever they've got. Right now most of them don't hang around long when they find out what we can pay...but I think that may change as time goes on.

Building lots have softened approximately 30-40% in the last 12 months. So of course now land is cheap.