Aldeer.com Forums Alabama Deer Talk Aldeer General Forum Rural Land Prices in South Alabama

As a kind of a thought experiment. Lets talk about the timber market. Im no expert by any means not even close but I have been wondering...

First to say, i agree with yall that recreation is driving the market and I think that only will continue to be

Next - it seems to me that if a lot of the big timber companies are selling their land and/or selling the land but retaining the timber rights for this market cycle, coupled with mills closing their doors left and right, like where do you even take the wood within feasible driving distance, it seems like they see the writing on the wall for the timber industry and the land.

That the land itself is essentially worthless from a timber stand point.

Maybe not worthless at any price but you get what Im saying i hope. Like its not worth the carrying costs of ownership, which I think would mean that its not worth owning let alone acquiring for the purposes of growing pine trees.

It just makes me wonder what the long term outlook of ownership is? And what the heck do you do with it if you don't grow loblolly's? Shift to longleaf? And does that market get saturated as well and you find yourself in the same boat but at a longer interval between cashflows which is even worse? Or do you let it grow back "natural", burn it, manage it for wildlife/recreation/future development, etc and resign yourself to a purely recreation market with no prospects of ROI from a timber standpoint - because if the long term return in negative - this is the best option because you aren't losing money?

On a side note, if more large tracts were recreationally focused I think it would be beneficial for wildlife that are struggling ie quail, turkeys, and to an extent deer (higher quality habit compared to wide expanses of poor industrial timber habitat). What would that do to the timber markets? If supply was decreased for wood products and demand stayed the same would it not push the market up - but with less players so to speak which is bad for jobs. I dont know. Complex problem.

Do you look back to when markets were "good" (were they ever "really good" like really or just kinda okay?) and see what the factors were that made that happen and what has changed now?
Maybe as a guess supply wasn't as high then and relative acquisition costs, costs of ownership ie property taxes, were a lot lower and the recreational demand was not there?

Its like if recreational demand tapered off due to recession etc and wood demand and development demand tapered off due to the same, you might see timber land getting fire sold at shockingly low prices as the market marked the dirt's intrinsic value to market which seems to be in realty perhaps very very little (dare I say - next to nothing?) Is this why the big timber companies are selling off their holding now? Selling into high recreational demand while the sun shines - because they know, its worth "less"?

I'm currently developing a tract of land on the parkway in Huntsville that was bought by Atlanta investors. Ain't no telling how much they paid for it. Gonna be a shopping mall. Man I remember 20yrs ago most of the land in southern Tennessee was $600 an acre. All that land around the north end of Winchester Rd was $600.

I think you have nailed it. I've been saying for years that timber land is worth only a few hundred dollars an acre when considering only what you can make on the timber. The numbers are only going to get worse.

It's nice to make some money from timber, but that can't be the reason you buy it.

Why would you not be able to say who bought a peice of land?[/quote]

They’re my Sister’s clients, none of my business to be telling.

Planting 10s of thousands of acres of pasture, row crop, and hay land in pines does a lot for you if you own a timber/land acquisition company. First off the kids who grew up in that small town will start looking for city jobs because you can’t make a living farming or running cattle on that land. If they do stay there they will either work in the timber industry or get real creative. After a while the saw mill becomes the main economic incubator of that community. Everyone will start saying farming/ranching was a thing folks did before the 80’s etc.. That’s when you decide to be a dumbass like me or move to where the money “is.” Before NAFTA a lot of the cotton grown around here went to VH and the t shirt/textile mills that women like my grandmother worked in. The big money has always been tied to government. They want everything concentrated, independence ain’t worth a damn if you want folks to stack lumber all day. Just what I’ve seen, I was 2yo when NAFTA passed

Amazon is buying up large tracts of land north of ATL and everywhere else for that matter for data collection/storage facilities and solar. A lot of those folks who sold out are looking for big tracts around here. Tech $ is where the check be

I was (now retired) a land broker for years in Monroe County, AL and own property around here. I have seen several decent smaller tracts in the past few years sell around here for $1500/acre bare dirt (marketable timber removed), landlocked (no deeded access) and with any mineral rights reserved. Thats the very low side. Land prices can vary wildly depending on location, adjacent neighbors, access, utilities. soil fertility, timber value, higher and better use upside (commercial or recreational use) and topography. Tracts which have a high upside recreational value (fit several of the criteria above especially good access and utility availability, are hard to find and in high demand. Timber can vary from $0 to several thousand per acre. Mineral rights can be worthless or of great consideration depending on area. Timber value can vary depending on local markets and access. Gravel of the right type is in high demand here and can be worth a lot of $. It's a lot to consider when you are in the market.

I bought hunting land in Southern TN in the early 80’s for 200.00 an acre. I even haggled at the price before buying it. The cheapest land I ever purchased in AL was a thousand an acre. I have a place for sale now that is 3,000 per foot! Land prices are all over the board now and not many bargains out there.

I have properties in TN and get at least 2 letters and one phone call a week from out of towners making offers on it. Most of the lowball offers are around 4,000 per acre. Seems folks from Nashville want a rural escape for the weekends and are willing to pay for it. When ever we sell land we have to buy back in order to cut some of the gains taxes out.

Better not price it or it will sell!

You gotta keep going dumbass, not for the money for the principle. I beleive what we do, and what we taught our children and grandchildren will come back around, and there will be very few who will be able to do it. And if it dont i can go to my grave knowing i earned everything i have, not many can say that, either

Principle ain’t worth chit if you can’t pay the bills.

Not many can say they earned what they have???? Most all of my friends can say that

You gotta take what he says with a grain of salt. He thinks AU is gonna make the NCAA football playoffs this year too.

We are in the process of buying a piece of land here around my house on the river. Mr grandpa 30 years ago bought some land a half mile south of this property we are buying and he paid 100 an acre for it. We settled for 2250 for what we are buying. That’s a huge increase in 30 years and I figure it will only go up and probably get to a point that the average working man cannot afford land anymore. They aren’t making it anymore. I leased a lot of land for a long time because I was scared I couldn’t afford my own place. One day I decided I was gonna try and purchase a place and I wish I had done it a long time ago instead of waste money fixing up someone else’s property. I own chunks of land now and I’m always looking for more.

Truth

Covid reset the market on all things recreational. When 6 Trillion is printed and enters the money supply, it has to go somewhere.

There are some decent deals here and there if you are very patient and you have the funds to move quickly. I just recently bought a tract at 14% below what it appraised for. Whether that is a good deal or not will only be shown in time. Also bought a tract in MS last year for below market value. In both cases, it was inherited land and the sellers just wanted it sold and were willing to negotiate. Don’t be afraid to offer what you think is a fair price.