Home Lot Values Approach Those of 2005 Housing Boom

The record-setting, rising price of single-family home plots nationally in 2021 will not exactly do homebuyers any favors when it comes to price, especially in New England.

The National Association of Home Builders (NAHB) issued valuations this week and found that six out of nine Census division values set records.

The U.S. median lot price now stands at $55,000, according to NAHB’s analysis of the Census Bureau’s Survey of Construction (SOC) data.

New England for 2021 was in a “league of its own” according to the report, which had plots there exploding by 67% to reach $200,000 – nearly quadrupling the national median.

“This means that half of all single-family detached (SFD) spec homes started in New England in 2021 were built on lots valued at or in excess of $200,000,” according to NAHB.

The strict, low-density local zoning regulations there is a primary factor. Move-in-ready, brand-new homes are not cheap.

Pacific Division Second in Price, Smallest in Nation

The Pacific division is home to the smallest lots and their median lot value reached an inflation-adjusted $143,000 in 2021, the second most expensive value in the nation and a record for the division.

Pacific division lots are the priciest in terms of per acre costs.

Similarly, the Middle Atlantic division recorded a strong rise in lot values and set a record with half of its lots priced at or above $90,000. The Mountain division followed with a median lot price of $75,000, another record, according to NAHB.

Also setting records were the South-South Atlantic and East South Central. Nonetheless, lots there remain among the least expensive in the country, including when measured “by acre.”

West South Central Lot Price Cools

The only declining markets were West South Central, which includes Texas, and East North Central.

For West South Central Division, “it was a welcome change,” according to the report, which was blogged about by Natalia Siniavskaia, Ph.D., NAHB Assistant Vice President for Housing Policy Research.

That area had been recording some of the fastest lot value appreciation in recent years, she wrote.

Less than a decade ago, half of SFD lots here were going for $30,000 or less, almost half of the current median of $55,000, according to the report.

Siniavskaia said in her blog that when adjusted for inflation, lot values are now close to the record levels of the housing boom of 2005-2006, when half of the lots were valued at over $43,000, which is equivalent to about $57,800 when converted into inflation-adjusted 2021 dollars.

“At the same time, home building shifted toward smaller lots, resulting in record-high prices per acre,” she said.