Strong Prices, Fewer Deals: What's Going On in the Texas Panhandle & South Plains Land Market?

With 2024 well behind us, ASFMRA has released their annual land trends recap for Texas broken down by regions. The rural land market across Texas is sending mixed signals—but nowhere is the contrast sharper than in the Panhandle and South Plains. If you're buying, selling, or just keeping a pulse on land in this region, here's what you need to know. 📈 Prices Keep Climbing, Even as Sales Cool

Land prices in the Panhandle and South Plains rose a healthy 8.19% year-over-year, reaching an average of $1,862 per acre. That’s nearly 69% higher than just four years ago. In a state where land is king, those kinds of gains are a big deal.

But here’s the catch: fewer deals are getting done.

• Annualized number of sales dropped by 3.66%

• Total acres sold fell by 13.05%

• Dollar volume declined by 5.92%

So, what gives?

It appears that quality—not quantity—is ruling the market. While overall activity is down, what’s selling are the larger, higher-quality tracts, often purchased with cash. That’s helping support values, even as broader market participation tapers off.

🚜 Cotton Woes and Drought Pain

This region, home to the largest cotton-producing area in the U.S., faced a trifecta of challenges in 2024:

• Poor growing conditions for a third straight year

• High abandonment rates on roughly 4.5 million cotton acres

• Falling cotton prices, slipping from $0.80 to $0.65/lb through the growing season

These factors are stressing the entire cotton infrastructure—from gins to warehouses—and slowing demand for mid-tier farmland. 🐄 Grass, Not Gimmicks

Still, all is not bleak. Demand is rising for cow-ready grazing tracts with permanent fencing and reliable water. Similarly, recreational ranches with unique features (like live water) are commanding premium prices. Buyers today are savvy—they're after turnkey usability, not raw speculation. 💡 Who's Buying?

• Existing ag producers expanding operations

• Private investment groups

• Institutional investors

Notably, there’s no surge in distressed sales—a sign that most landowners are holding firm, and the market is underpinned by real value rather than speculation. ✍️ My Take: Stability Masks a Quiet Power Shift

Here’s how I interpret the data:

• Prices are holding strong because buyers with cash are targeting quality over quantity. The land itself—especially tracts with water and grazing infrastructure—is still in high demand, even if the total sales volume is down.

• Agricultural headwinds, particularly in cotton, are curbing expansion from producers who rely on lending. This creates opportunity for well-capitalized buyers to step in.

• Drought and input costs are a drag, but they’re not yet a breaking point. There’s caution in the market, not panic.

• This is a market in transition—and if interest rates ease in 2025, we could see activity surge again as the sidelined capital comes back in.

For now, the Panhandle and South Plains are showing the classic signs of a tight, maturing land market: stable prices, selective buying, and a premium on quality. If you’ve got land to sell—or are looking to buy—make sure you’re working with folks who know what "value" really means out here.