High interest rates. New tax rules and shifting commodity prices all shaped the land market in 2025. To understand what that means for Arkansas, the Delta and buyers who are still sitting on the sidelines, Ozarks At Large’s Jack Travis spoke over Zoom with Tyler Davis and David Hill of Saunders Real Estate, which tracks land sales across the region.
Tyler Davis: So, 2025 was an interesting year in the real estate and land markets. I think we had, at a macro level, we had several different big ticket items that were having an impact, right? We had high interest rates that have now started to trickle down a little bit. Probably not as fast as some people would like, but they’re moving in a good direction, I think as we think about 2026. We also had tax reform with the One Big, Beautiful Bill that was passed. That was an uncertainty coming into this year. A lot of the provisions there are overall very positive for real estate. And as interest rates come down and as people have a little bit more certainty around tax implications of transactions, I think there’s a lot more certainty, moving forward than there was if we rewind the clock 12 months ago.
From a traditional ag-commodity pricing perspective, there were several provisions in One Big, Beautiful Bill that positively impacted Arc and PLC payments, increased minimum pricing, things like that hadn’t really been updated in a while. So that's good for farmers. Also we had in terms of a macro item in 2025, we had tariffs. The uncertainty around what would happen with tariffs. And I think we’ve seen some consequences from that, both intended and unintended as we look at the Midwest and we even think about the Delta in terms of rice and exports and things like that. And so we’ve certainly seen that, from a corn and soybean perspective in the Midwest.
At a high level. I think there’s, I think, overall more certainty moving forward than there has been, or at least there was going into 2025, which I think will have a positive impact on transactions and volume, interest rates coming down allows more people to get financing. I think it gives consumers a lot more confidence, in potential buyers, a lot more confidence in the market. And, overall, I think at a high level, I think people are a lot more comfortable going out and making decisions, hopefully moving forward in 2026 than they have been in ‘25.
Jack Travis: Then, speaking specifically about Arkansas, how do you expect those trends that you saw with the Lay of the Land report? Do you all expect those to continue into 2026? I mean, a lot of them were kind of based on historical data, right? So, I mean, it’s not something that switches and changes so quickly. But I might be misunderstanding. Maybe it is.
Davis: No, I think in Arkansas it depends on the region too. Northwest Arkansas, a lot of the growth is driven by population, population growth, new jobs, employment growth. And I don’t see that stopping. I think one of the challenges right now is a lot of home builders are trying to sell through inventory that they have, on the books, right? Those things didn’t fully come to a halt, but I think it’s taken longer for home builders to sell off some of their existing inventory, just with high interest rates and all that.
We’re seeing that kind of across the board. I mean, whether it’s these markets that were super hot for the last several years, Florida, you know, all the way up to Arkansas and places like that that have been some of the highest population growth markets in the country. Things have slowed down a little bit on that front. They haven’t come to a halt, but it’s just taken longer for people to sell off lots and sell off houses. Just because people are more hesitant to move when you have a 2.9% interest rate that you locked in in 2022 or 2021. You’re not jumping at the bit even, you know, to go buy a bigger house if you have to get a loan in the fives or the sixes. So I think interest rates are coming down. There’s a lot of pent up demand right now of people who haven’t moved because they’ve been locked into an interest rate.
And so if interest rates continue to fall and mortgage rates trickle down with that, I think we’ll see more local buyers reenter the market. You know, coming out of COVID. And I think Arkansas was a big beneficiary, northwest Arkansas in particular, was people relocating to areas. We felt it in Florida. We’ve seen it in Georgia. We’ve seen it in Arkansas, Carolinas as well. I think that inward migration is starting to slow a little bit. But I think what we’re going to see is more local buyers for houses and new builds kind of enter the market. People who haven’t been able to afford it because of where interest rates have been the last 12 to 24 months.
On the ag-land side of things, kind of more in central Arkansas and down into the Delta, I think it's commodity price driven. But you also have recreation values, especially in the Delta, that are going to continue to remain strong, I don’t foresee that changing unless we have a big change at a macro level. A lot of the buyers for those recreational assets are high net worth individuals or doctors or attorneys or people who own a construction company, and they want to be able to take clients out and entertain them. And unless things change from a macro perspective, I don’t think those land values are going to suffer at all. I think the traditional farmland properties that don't have a recreation component, I think there’s some questions long term about when people want to sell, who’s going to be there to buy some of those properties up? Which is sad, but it’s also the reality. I think that will probably have somewhat of an impact on pricing. The hard years that some of these farmers have had in a row here, is, I think eventually there’ll be a little bit of a price correction. We haven’t seen a huge one yet. But, David, do you have any thoughts on that side of things?
David Hill: I don’t have any thoughts, but it’s something that I’ve been thinking a lot about. I think about it a lot. Don’t have any hot takes on it though. But it is interesting because, you would logically think that there would be a price correction, but it’s institutional buyers that are buying up a lot of this farmland. So it hadn’t really affected the price at all. We’re seeing price per acre on tillable farmland. It definitely hasn’t gone down. If anything, it just keeps going up.
Davis: We've been tracking the Delta in particular. I’m pulling up our numbers. So far this year, almost 8,000 acres have been transacted. Average price is just south of $7,000 an acre. And that’s pretty much in line with what it’s been. And then as we look into some of these other regions, like north Arkansas, for example, demand for hunting and recreational land, timberland is continuing to remain really strong. And that’s across probably 10,000 acres that we’ve tracked. It’s in the $4,000 to $5,000 an acre range. And so we’re seeing that demand for land continuing to remain strong, even for people who just want to recreate and get outdoors or build a family compound like that. That demand is still there.
Travis: That’s interesting. So that brings to mind something that I did want to talk about, something that you brought up last time we spoke, David, about the aging population, specifically in the Delta. I just remember that it really stuck with me, especially as I drive around northwest Arkansas. I mean, you can even see it up here. And, so I just wonder, as people begin to age out, you know, whatever that means, do you think that that will have an effect on these, these prices or I guess the selling of this land?
Hill: I think it definitely is going to have an effect on people selling the land. It’ll be interesting to see what effect it has on price, because obviously if there’s more supply, then the demand is going to go down. And that in theory should lower prices. But we’ll see. I mean, the Delta tillable farmland in the Delta is so highly sought after. What I’m interested to see is what happens, is there going to be enough people to farm it, though? Because again, you have all these institutional buyers who can buy massive, huge swaths of contiguous farmland. But you have to have tenant farmers to farm those. And those are the people that are getting crushed right now with commodity prices.
Davis: And pricing competitive on rent rates to justify the institutional investment, right. I mean, it's one thing to have one operator in an area, but if you just have one operator, they can kind of dictate rent rates, which thus impacts the ability that an investor can pay for the property and the amount of demand there is for the sale of the property, right? You look at somewhere like Illinois where there’s operators on every corner. There’s no shortage of it and won’t ever be. I think it’s a little bit different in the Delta right now. At the end of the day, real estate, including land, is space for people. You know, how do you define a good piece of property? Well, how many people live close to it? Right? The more people there are, the more demand there is for that asset and regardless of the use of it. So stuff that’s even farmland close to a city center is going to typically demand a premium. So in the Delta, you have a lot of people moving out and negative population growth. And I think that is something to monitor long term and the impact that that can have on pricing.
Travis: Is there anything that you would, maybe, some sort of actionable item that you would suggest for a sideline buyer, someone who’s waiting for these interest rates to go down. Waiting for some of this tax reform to come through, watch, watch tariffs, see how they affect the economy. What would you recommend that they do this next year?
Davis: There’s a running joke in this industry and it’s true, right? If you look at long term land value trends, you know, the best time to buy land was 10 years ago, right? No matter when you say it, I look at Florida values and values in Georgia and Alabama and some of these other markets in Arkansas, and you look back to what they were 10 years ago or 20 years ago, or you look at what a property sold for, you know, early 2000, nineties, late 2000 even. And you think, man, if only I could buy that now for that value. Well, I think we’re going to be saying the same thing 20 years from now.
And so, there’s no time like the present. Be thoughtful. You know, if you have a long enough hold period on a property and you’re a cash buyer and you don’t have to worry about the financing side of it, I think parking money in a well located, well positioned asset, piece of land, is a good strategy, right? It’s going to continue to appreciate if you buy the right areas, buy the right types of properties. So, you know, I typically try to suggest to people, if you're going out trying to buy properties and investment, don’t get overly price sensitive in the meantime. Don’t lower your standard to buy something to save $200 an acre if it’s not of the same quality or $500 an acre. Buy something that is really quality if you have a long term vision in mind for it, and it’s going to reap the rewards because the appreciation on A class properties, even if you have to pay a little bit more for it now is going to be drastically higher than, you know, the appreciation on B or C class property. And if the market turns, the A class are the last ones to feel it. So try to encourage people to go buy premium quality assets and over time, I think it’s turned out to be a good strategy for a lot of people.”
That was Saunders Real Estate President Tyler Davis and Arkansas Region Managing Director David Hill. You can visit this link to hear Jack’s previous report about statewide real estate trends with Saunders.
Ozarks at Large transcripts are created on a rush deadline. Copy editors utilize AI tools to review work. KUAF does not publish content created by AI. Please reach out to kuafinfo@uark.edu to report an issue. The audio version is the authoritative record of KUAF programming.
