The Effects of Population Increases

Sunday, October 11th, 2009

As long as our overall population continues to increase the demand for land will be present.

We currently have mortgage rates 3 points below historical norms and they seem to go lower every time the Fed meets. Conditions make now one of the best times to buy since 2004, according to CNNMoney.com citing “housing valuations are almost back to long-term norms”.

Population growth, not speculation, is the flood lifting this boat. Quality land, bought at the right price with sensible financing, should weather a recession better than stocks and many other investment alternatives. Good land is a better place to wait out a recession than most others.

Demand for land grows because America’s population is increasing and the top one-third of our income distribution has discretionary cash.

An acre of Texas property cost an average of $2,190 in 2007, up 20 percent from the year before, according to the Real Estate Center. And land prices lately have been going straight up; with double-digit increases one year followed by more double-digit increases the next.

The Real Estate Center said the pattern can't continue forever, but said that land remains in demand thanks to demographic trends and mayhem in the rest of the economy.

Tags: demand for land, demographic trends, population growth, population increase, unstable economy