Texas A&M researchers say people are looking into real estate - ABC 40 KRHD-TV - Bryan/College Station News and Weather |

Texas A&M researchers say people are looking into real estate

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COLLEGE STATION-- A new study suggests people are looking into real estate instead of investing in Wall Street. The prices on crop lands and real estate are reaching levels not seen since before the recession. That had researchers at the Texas A&M Real Estate Research wonder why this was happening.  So they got to work and found out that more people were wanting to invest in real estate and crop lands instead of stocks. 

Mark Dotzour, the director of research at the center, says that's because people aren't confident in the government.  They want to invest in something that can survive inflation.  Both crop lands and renting homes or apartments can be updated year to year to adjust for raising prices.  He says these are the same kinds of people who invest in gold. 

"I think people that are buying farmlands and apartments as a hedge against inflation," Dotzour said.  "Are more long term investors, they're not flippers.  They're looking for a place to invest money as an alternative to having a savings bond or money in a certificate deposit because they're afraid that what will happen over time is inflation will erode the value of their savings."

According to Dotzour, over the past couple years Iowa farm land sales have increased from $7,000 an acre to $12,000 an acre. He said while that's where the nation has seen its highest peak in farm prices, other areas are rising too.  In the Texas panhandle area where lands are largely devoted to farming, prices have increased by 18%.