Evaluating the Maryland Land Market

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Evaluating the Maryland Land Market
By

Bart Waldon

Maryland is a mid-Atlantic state with a long history and diverse landscape. The state has an estimated population of over 6 million residents and features coastal plains along the Chesapeake Bay, rolling piedmont regions, and forested mountain ranges stretching across the western portion of the state. Maryland's largest city and capital is Baltimore, though the state also encompasses rural farmlands and smaller regional hubs.

When evaluating the Maryland land market, it is important to consider broader real estate trends across the state as well as factors specific to different counties and land types. Some key highlights about the Maryland land market include:

Demand Drivers in Maryland Real Estate

Several underlying demand drivers impact real estate in Maryland, including land:

  • Population Growth: Maryland’s population grew over 6% between 2010-2020. More residents and families continues to drive demand for housing and development.
  • Proximity to Washington D.C.: Northern suburban counties near Washington D.C. have seen particularly high growth as the capital continues expanding. This leads to demand for land to support more homes, offices, infrastructure.
  • Revitalization of Baltimore: Initiatives to revive Baltimore have helped stabilize growth after decades of population decline. While progress is gradual, rising interest in city living will impact outer lying land.
  • Tourism: Popular coastal and mountain tourist regions bring investment in hospitality projects and second homes, requiring land purchases.

Key Factors Influencing Land Values

Land values vary greatly based on location and intended use. Some key factors influencing value include:

Development Potential: Land set aside for commercial or residential development carries the highest values based on zoning allowances and local market needs.

Access/Exposure: Land parcels near major highways, tourist areas, or hubs with heavy foot/vehicle traffic are more valuable.

Amenities: Land with pre-existing structures, utility access, lush landscapes, water frontage, or other amenities warrant value premiums.

Lot Size: While larger lots allow for more uses, smaller lots around growth regions carry higher per acre values in Maryland.

County Dynamics: Land values range widely between rural counties versus suburban regions near major cities based on job/population outlooks.

Evaluating Different Maryland Land Types

When assessing land parcels in Maryland, the intended use and market conditions for various land categories also impact value, including:

Residential Land

  • Highest demand exists around suburbs with access to Baltimore, D.C., other growing cities
  • Smaller infill lots primed for townhouses or single family homes most attractive
  • School quality shapes values dramatically for family home development

Commercial Land

  • Retail land values peaked pre-pandemic; industry still recovering tenant demand
  • Popular around busy transportation corridors and maturing neighborhoods
  • Smaller mixed use lots gaining attention in revitalization zones

Agricultural Land

  • Most valuable in Central Maryland counties amidst heaviest development
  • Southern Maryland maintains active crop farming, livestock, and equipment storage uses
  • Conservation easements limit development potential but enable farmers to earn income

Undeveloped/Forest Land

  • Western mountain and coastal marsh regions feature most undeveloped land
  • Valued for hunting/fishing uses and very limited cabin/resort development
  • Permanent preservation via land trusts increasingly common

Current Maryland Land Market Conditions

Maryland's land market remains competitive, with over half of listings typically under contract. However, conditions vary based on county and land use.

Suburban Land Market

Suburban counties within commuting proximity of Baltimore or D.C. represent the hottest land markets in Maryland currently.

  • Extremely constrained supply amidst high demand for residential lots and mixed use development sites
  • Median sales prices for vacant residential land up 10%+ annually
  • Even partially cleared land draws interest from builders/developers

At the neighborhood level, the most desirable suburban land parcels feature:

  • Space for 5-50 single family homes or townhouses
  • Access to transportation corridors with capacity
  • Minimum lot sizes around 4,000 sq. ft.
  • Walkability to schools, retail, parks, trails

Under-utilized retail centers with redevelopment potential also see heightened demand.

Rural Land Market

In contrast, rural counties with slower population growth feature more balanced land supply/demand.

  • Steady sales activity year-round for farm and forested acreage
  • Buyers value production potential, natural amenities, limited regulations
  • Average time on market around 6 months for most listings

Out-of-state buyers show particular interest in hunting/recreational lands during fall months. And properties listed below regional value benchmarks tend to sell fastest.

Commercial Land Market

The pandemic severely dampened demand for retail land while accelerating needs for industrial/logistics development sites.

  • Retail land values dropped 30%+ as stores closed and shopping centers suffered high vacancies
  • Industrial sites with interstate access coveted for expanding distribution centers
  • Growing interest in suburban office parks suitable for converted flex space

Bright spots exist where retail sites can be repurposed through mixed use development. And office/industrial parks near major highways or employment hubs will likely recover quickest.

Best Practices for Buying/Selling Land

Navigating real estate transactions can be complex and time consuming without the right guidance. Here are best practices to consider:

If You’re Buying Land

Define plans/budget: Outline intended parcel use and improvement budget to focus the search. Sites warranting entitlement changes often carry purchase premiums.

Research regulations: Verify county zoning, density allowances, required assessments, and permitting nuances to gauge viability.

Inspect carefully: Require recent boundary and environmental studies from sellers to reveal any easements or physical complications early.

Engage local experts: Consult specialized attorneys, architects, agents to explore bylaws and engineering needs for proposed projects.

Be ready to move: In competitive markets, buyers benefit from pre-approvals for financing and internal project approvals to enable swift offers.

If You’re Selling Land

Confirm permissions to sell: Verify all lien holders and partners consent to a potential sale before listing the asset.

Stage attractively: Mow overgrown fields, clear debris, install signage to help buyers visualize potential and increase curb appeal.

Highlight value drivers: Play up unique amenities or features priming land for development/use based on market demand.

Market extensively: Leverage multiple online and offline channels to reach specialized land buyer audiences.

Prepare due diligence: Pull together surveys, title reports, disclosures to simplify buyer verification and close faster.

For owners struggling to sell land independently, selling to a trusted land acquisition company can make the process easier. Land Bosses professional team streamlines transactions with cash offers, flexible closing timelines, and "as-is" purchasing. Their five years specializing in land means provides owners more guidance and convenience.

Outlook for Maryland's Land Market

As Maryland contends with rising interest rates and recession warnings in 2023, real estate dynamics may shift. But key demographic and economic tailwinds bode well long term.

Ongoing population growth and the rise of remote work should sustain housing demand across the state – focusing attention on developable land in both urban and suburban counties. Commercial real estate may suffer vacancies and value corrections short term before recovering.

Rural regions will likely see steadier land activity based on resource production and recreation appeal. However, climate change introduces uncertainty around farming viability and the risk of extreme weather.

With strategic navigation of evolving conditions, substantial opportunities remain for both land buyers and sellers across Maryland markets. Paying close attention to macroeconomic factors and micro-market nuances will be key to timing transactions advantageously.

Final Thoughts

The Maryland land market features diverse opportunities amidst a mosaic of development hotspots and steadier rural regions. While market conditions fluctuate in the short-term, broader demographic drivers point to healthy longer-term demand across residential, commercial, agricultural, and undeveloped land types. Astute investors and developers willing to adapt strategies to capture shifting needs across Maryland's counties stand to capitalize on the state's continued expansion. At the same time, selling land profitability hinges on proper preparation, pricing, and exposure to qualified buyers. Engaging professionals can ease transactions for strained sellers. With adept navigation, the Maryland land market offers fertile ground for land owners and investors alike.

Frequently Asked Questions (FAQs)

What counties in Maryland have the most valuable land prices currently?

The hottest land markets currently concentrate around suburban counties near Baltimore and Washington D.C. featuring high demand for residential and mixed-use development sites. Specific counties include Howard, Anne Arundel, Montgomery, and Prince George’s.

How much does undeveloped rural land typically sell for in Maryland?

Prices vary dramatically based on size, county, and amenities. But average values range from $5,000 - $15,000 per acre for undeveloped rural land across most Maryland counties, outside of the closer-in suburbs seeing more pressure.

How long does it usually take to sell land in Maryland?

In the hottest suburban counties, competitive listings often sell within 1-2 weeks. But average time on market stretches to around 6 months for rural properties and land requiring entitlement changes for development. Retail land can take years to draw buyer interest.

What types of land tend to sell fastest in Maryland?

Residential lots in communities near transportation access and amenities move fastest, as do cleared land parcels zoned for mid-density housing near employment centers. Sale-priced and shovel-ready development sites also sell quicker.

Why consider selling land to a dedicated land buying company?

Companies like Land Bosses specialize in buying and selling land, making it easier for strained sellers. They provide cash offers, handle paperwork/approvals, and give sellers more guidance on optimizing sales. This provides convenience and efficiency.

About The Author

Bart Waldon

Bart, co-founder of Land Boss with wife Dallas Waldon, boasts over half a decade in real estate. With 100+ successful land transactions nationwide, his expertise and hands-on approach solidify Land Boss as a leading player in land investment.

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