As a consumer lending officer, Tony McAvan (NMLS ID 495046) has a list of friends who have asked him to keep an eye out for land that meets their recreational or home-building needs. Most people in the rural real estate industry do, McAvan said. In today’s market, everyone’s list of prospective buyers is growing.
Rural properties within an easy commute of job centers are particularly attractive to buyers in his area, said McAvan, who works in our DeWitt, Iowa, office, providing marketing and loan application support for Rural 1st®, the tradename of a consumer home lending program offered by Farm Credit Mid-America. Sportsmen, always on the hunt for land, want a quick getaway to safely spend time with family and friends during the COVID-19 pandemic. Families, juggling work, school and home life under a single roof for much of the past year, have decided a home in the country is attainable in this period of kitchen counter “commuting.”
These trends aren’t limited to FCSAmerica’s four-state territory. The national Realtors Confidence Index (RCI) reported in January 2021 that the pandemic continues to impact how people live and work. The survey of realtors found 88% of buyers -- a 10% increase from the prior year -- are purchasing land in rural, small town, suburban or resort areas. Fifty-six percent of realtors who participated in the survey said potential buyers want work-from-home features, such as an extra room, a finished basement or a bigger house.
“People are home more. They want their homes to be more of a sanctuary,” McAvan said.
Home renovators have spent the past year sizing up the shortcomings of their houses and have decided to knock projects off their to-do list, he said. Lots of kitchens have been upgraded during the pandemic.
For those financing new construction, McAvan said, “the bigger the house, the better.” The smallest construction project in McAvan’s current portfolio is 2,200 square feet.
Even some of the land bought today for recreation will eventually become home sites. Sportsman may be able to put as little as 15% down to buy land, enjoy it for a while and, when the time is right, build their dream home on the property, McAvan said.
While COVID has shaped some of what people are seeking in their country homes, it is not driving demand. Low interest rates supported the real estate market in 2020 and continue to benefit buyers in 2021, McAvan said.
“People are spending less, are home more and, if you have a stable job, today’s interest rates offer an opportunity to make your home nicer or to make a move,” he said. “The people I work with aren’t moving because of COVID. They are people who have wanted to do this, and low interest rates made this the right time to move.”
