2020 was, bluntly speaking, a dramatic year. One of 2020's leading storylines was the perception that United States citizens would begin an “Urban Exodus”, migrating from densely populated areas to small-town areas, capitalizing on rural land for sale at a much-reduced cost. This mass migration was said to be a result of citizens seeking to escape infection risk, job loss, political turmoil, and quarantine measures put into place in dense, urban areas.
The idea of buying land and living in a cabin holds a lot of appeal for many urban dwellers and with remote work becoming more accepted, this scenario makes sense. While we can give opinions on outlook and projections, let’s take a look back at 2020 first for some insight into rural land for sale in 2021.
The Urban Exodus
In late March and early April of 2020, the United States started to impose lockdown measures in cities throughout the country. These densely populated areas made the transfer of a potentially dangerous virus easy and fast. Lockdowns were sanctioned on a city by city and state by state basis to varying degrees of success.
Covid-19 alone would have been enough to make urban areas a difficult living situation, but in some cities, this was exacerbated by race riots and counterdemonstrations. The consensus was that we were about to see a mass exodus of people moving away from densely populated areas and into a small town, rural life… but did this really happen?
The true impact of this does depend a bit on where you look. Real estate companies associated with urban real estate have highlighted how well their markets have performed. Rural markets and land sales companies have mentioned the urban exodus on a consistent basis which probably will not change as we go into 2021. Sifting through the facts takes a bit of doing and the results are much less dramatic than the title of “Exodus.”
Urban Real Estate Trends
Supporting evidence of an exodus focuses primarily around a few key urban areas, namely Manhattan, San Francisco, and Chicago. As CNBC noted, ‘The flight to the suburbs is real and growing, as coronavirus changes the way people live’. In this market study, CNBC highlighted that cities such as Manhattan experienced drops in real estate purchases up to 80% as of May 2020. They also released polls stating that more than half of the nation’s 100 largest metropolitan areas are seeing increases in residents considering a move to suburban areas. The New York Times further supported this decline in Manhattan markets, stating, “New Yorkers Are Fleeing to the Suburbs: ‘The Demand Is Insane’.” New York, throughout 2020, experienced rapid growth in Long Island and East Orange, New Jersey. Increases in these areas rose 44% in some areas and 112% in other areas. Combined with a declining Manhattan market, it is easy to connect the dots that these urban residents could be fleeing to more suburban areas.
The decline in the Manhattan marketplace, as well as San Francisco, does hint a bit towards the exodus to rural areas concept, however, the country does not revolve around these two cities. The rest of the evidence-based on the urban exodus points in an entirely different direction. NPR’s Planet Money highlighted the same evidence, that Manhattan and San Francisco. This is mostly associated with those two cities experiencing the highest cost of living in the country. What they found though, was that most of the change of address forms filled out have these residents moving to other metropolitan areas such as Seattle, L.A., Chicago, and other densely populated areas. While residents of Manhattan and San Francisco have left those areas in droves, the surrounding suburbs have experienced, as CNBC and the NY Times supported, increases up to 45%.
Looking at the Big Picture
This is where the data for a real estate exodus from urban to rural areas stops. Zillow economist, Jeff Tucker, said it best, “When you step back and look at the bigger picture, it seems that those writing off urban real estate have done so prematurely.” Jeff went on to describe that the phenomenon is seen in Manhattan and San Francisco real estate market declines seem to be isolated to those areas. Simply put, according to Jeff Tucker, there is not much evidence of any kind of exodus during 2020.
The findings seen by Jeff Tucker are supported by other real estate research outlets with the conclusion that urban areas are in fact seeing steady and consistent growth, but so are suburban and rural areas. These growth patterns reflect a robust economy combined with an extremely low-interest rate. These patterns are almost traveling in lockstep with neither outpacing the other. Simply put, people are moving, but not necessarily to either urban or rural areas.
What Does This Mean for Rural Land Value and Real Estate in 2021?
With the findings of 2020 showing no statistical evidence of an urban exodus, what does this mean for rural real estate market trends in 2021? The USDA outlook on farmland value has prices remaining consistent if not experiencing a subtle decline in 2021. This outlook is reflected in other media and data outlets, showing a steady, industry average in rural, undeveloped, and agricultural land markets such as farms and ranches.
These findings of consistent markets make the buying and selling of rural land a solid investment opportunity for 2021. There is no news in the marketplace of prospective interest rate increases and the lack of an urban exodus means that real estate will avoid bidding wars seen in past “hot” markets. Some markets are increasing faster than others such as those in Idaho and Texas, but most of the country is anticipated to remain consistent for the oncoming year.
How to Take Advantage of Rural Land for Sale in the U.S
If you are looking to purchase rural land in 2021, you haven’t missed the boat. Current rural land value trends have the market primed for real estate purchases. If you are looking to sell, data is not suggesting that 2021 will be a hot sellers’ market unless you live in an area that is experiencing a rapid influx of purchasers.
To get started, Click Here to browse the current selection of rural land for sale in the U.S. If you have any further questions, feel free to contact us anytime and we would be happy to help you in your decision-making process.