Thread by @RickPalaciosJr

Land is the most important yet least transparent part of homebuilding. To help, here’s commentary from land brokers across the country per our July survey. Top themes: 1) Builders going further out for deals. 2) Bigger land deals are back. 3) Development delays & lot shortages.

#SaltLakeCity land broker: “You can't get all the lots you need even when you overpay.”

#SanAntonio land broker: “Getting a vaccine approved took less time than getting land entitled.”

#Houston land broker: “Market is as strong as I’ve ever experienced. Money chasing every property that has any potential of being developed into lots. Trend of builders & developers looking further out has continued & is pushing prices higher for rural land.”

#Dallas land broker: “Builders have high demand for more lot pipeline and are more open to larger deals in order to get some scale. Smaller tertiary markets have never been in such high demand.”

#Chicago land broker: “Some builders have told me they can’t pass on material cost increases to buyers anymore & therefore, land prices are beginning to hold tight. Developments perceived to be too far out a couple years ago are selling well today.”

#Minneapolis land broker: “A lot of groups chasing build-for-rent but few executing. Demand for townhome land is increasing.”

#Atlanta land broker: “Almost every land tract that was close to getting sold in 2006-2007, all markets around Atlanta are back to those values or higher.”

#Charleston land broker: “Consensus is we're at the top of the market, so folks who haven't listed or been willing to sell in the past are now entertaining the idea of cashing in and letting go of long-held vacant land.”

#RaleighDurham land broker: “We used to use $40k as a back of the napkin estimate for the cost to develop a finished lot with city water and sewer. Now that cost is $70k.”

#Savannah land broker: “Raw land typically acquired for single-family residential development is being developed with distribution warehouses.”

#Phoenix land broker: “Masterplans have 9-12 month lot development delays. Buyers flipping transactions that have been in place for 12+ months have 100% price increases in some cases, but this isn't the norm.”

#Tucson land broker: “Tucson homebuilders have 6 months of finished lots in open communities remaining & another 12 months of paper lots to develop. An adequate pipeline in this market should be about 30 months, so it’s undersupplied by half right now.”

#Tampa land broker: “Good time to be a land owner.”

#LosAngeles land broker: “Running out of opportunities & active community count is at a cycle low. National builders are passing on Los Angeles proper since lot counts aren't big enough for them. They’d rather focus on secondary/tertiary markets to achieve larger lot counts.”

#OrangeCounty land broker: “In some cases, builders have opted to focused on the materials 'scavenger hunt' over the pursuit of new land.”

#RiversideSanBernardino land broker: “Inland Empire multifamily land market is strongest in my career.” THE END