Alabama Land Values Over Time

1
Alabama Land Values Over Time

• The following slides come from Professor Walt
  Prevatt of Auburn University.
• They show the changes in Alabama land values over
  time, in comparison to the region and to the
  country.

2
Farm Real Estate Values,Alabama, 1950-2003
3
Farm Real Estate Values,Alabama, 1950-2003
1Alabama Farm Real Estate Values were deflated
using the Gross Domestic Product Deflator,
1950100.
4
Annual Percent Change In Farm Real Estate
Values,Alabama, 1950-2003
5
Farm Real Estate Values,Alabama U.S., 1970-2003
6
Population Determines Rural Land Value

• The following slides, also from Dr. Prevatt of
  Auburn, show what influences the value of
  agricultural land. The r2 indicates how
  strongly a factor influences land value.
• The first two slides show that cotton prices and
  calf prices have almost no influence on land
  value. Productivity is not key.
• The third slide shows that timber value accounts
  for about 35 of land value.
• The fourth slide shows that population accounts
  for about 61 of land value (96 35 61).
• Population has influence because of the demand
  for housing and other development. Land can be
  held for speculation because of the low tax.

7
Econometric Analysis Of Value

• Cropland ValueCropland Value f ( Alabama
  Cotton Prices ) Cropland
  Value 1,362 - 525 CP
  R2 0.0693

8
Econometric Analysis Of Value

• Pastureland ValuePastureland Value f (
  Alabama Calf Prices )
  Pastureland Value 937 0.5019 CP
  R2
  0.0009

9
Econometric Analysis Of Value

• Timberland Value
• Timberland Value f ( Alabama Timber Prices
  ) Timberland Value 9.2193
  30.3644 PP
  R2 0.3459

10
Econometric Analysis Of Value

• Farm Real Estate Value (FREV)
• FREV f ( Forestry Receipts Population)
  FREV -1234 2.85
  FR 39.01 POP
  R2 0.9617