Case Study · Real Estate · 2019-2026
The real-world data behind the land research scenario - prices, taxes, capital gains, commissions, gains and pitfalls across the 2019 pre-COVID to 2026 arc.
At a glance · 2025-2026 figures
New York
California
Texas
Land price appreciation
Following stabilization from 2014 to 2020, US farmland values began appreciating sharply in 2021 and continued through 2025. The 5-year CAGR from 2019 to 2024 was 5.8% nationally - or 2.0% after inflation adjustment. COVID-era remote work migration, institutional investment, and constrained supply drove the acceleration.
| Period | National trend | New York | California | Texas |
|---|---|---|---|---|
| 2019 pre-COVID | Flat / stable. US avg ~$3,160/acre | Upstate NY rural land largely flat. Low buyer interest | Wine/coastal premium already high. Central Valley steady | Rural land affordable. Ranch demand moderate |
| 2020-2021 | COVID disruption then sharp surge begins | Remote work migration drives upstate demand +30-40% | Coastal exodus fuels Central Valley and inland price jumps | Austin-Hill Country explodes. Far West TX begins climbing |
| 2022-2023 | Continued appreciation. CAGR 5.8% annualized | Growth moderates. Interest rate pressure | Coastal areas cool but rural and ag land holds value | Strong across all regions. Institutional buyers enter |
| 2024 | Plateau. Values stable nationally | Slight softening. Supply still constrained | Holds value. Prop 13 advantage for long-term holders | Rural land cools slightly. Urban TX markets diverge |
| 2025-2026 | US avg $4,350/acre, +4.3% YoY | $4,010/acre cropland, +4.2% YoY | Premium land sustained. New buyer Prop 13 shock | +5.4% cropland. Far West TX +15.8% YoY |
Annual property taxes
Property taxes are the most misunderstood cost in land ownership. California's Prop 13 creates a two-tier system where longtime owners pay a fraction of what new buyers pay. Texas has no income tax but compensates with higher effective property tax rates.
Capital gains on sale
On the same $500K gain, the after-tax outcome varies by over $66,000 depending solely on which state the land sits in. California taxes all capital gains as ordinary income - there is no preferential long-term rate at the state level.
Real estate commission
The traditional 6% commission model - standard and largely non-negotiable in 2019 - was disrupted by the 2024 NAR antitrust settlement. Buyer-agent fees are now disclosed, negotiated, and paid separately.
2019 - Pre-COVID standard
~6.0%
Traditional split: 3% to seller's agent, 3% to buyer's agent. Non-negotiable in most markets. Both sides paid by the seller. Industry standard enforced through MLS rules.
2026 - Post-NAR settlement
~5.49%
Commissions no longer listed on MLS. Buyers must sign written agreements before viewing properties. A brief post-settlement dip rebounded by early 2025. Rates rose in 39 of 50 states between 2024 and 2025.
The bottom line on commissions: Despite widespread predictions of a 50% commission drop following the NAR settlement, the market largely absorbed the change. The real shift is structural - buyers now negotiate agent fees directly and separately, flat-fee models are growing, and the default assumption of a 6% seller-paid dual commission is gone. For land transactions specifically, rural property commissions often run 6-8% due to longer listing cycles and smaller buyer pools.
Comparative risk matrix
| Factor | New York | California | Texas |
|---|---|---|---|
| Top gain | Accessible entry prices. Strong upstate appreciation post-2021. Proximity to NYC demand | Premium land appreciation. Prop 13 locks in low taxes for long-term holders | No state income or capital gains tax. Diverse land types. Strong institutional demand |
| Top pitfall | Among highest property tax rates in US. School district levies unpredictable | Prop 13 reassessment shock for new buyers. 13.3% exit tax erodes gains | More permissive 10% homestead assessment cap vs. CA's 2% - tax bills climb faster |
| Climate risk | Flooding (upstate), coastal vulnerability | Wildfire, drought - insurance costs rising sharply | Flooding, tornado corridor, drought in west TX |
| Zoning | Complex ag zoning. Environmental review required | Strictest in US - CEQA can delay development years | Relatively permissive. County-level variation |
| Exit tax (state) | 10.9% | 13.3% - highest in US | $0 |
| 5-yr ROI verdict | Moderate. High taxes compress net returns | Strong appreciation but exit tax and Prop 13 shock create entry/exit friction | Best net ROI at the 37% federal bracket - $0 state cap gains is decisive |
Sources and references
USDA NASS Land Values 2025 Summary
Primary federal source. NY cropland $4,010/acre, TX +5.4%, US avg $4,350/acre.
USDA NASS 2025 Land Values Highlights
State-by-state breakdowns including TX Far West region +15.8% YoY.
California Property Tax 2026: Prop 13, Prop 19, Mello-Roos
2% annual cap for existing owners, full reassessment for new buyers, effective rates 1.15-1.35%+.
Texas Property Tax: The 10% Homestead Cap
TX Tax Code Sec. 23.23: 10% annual assessed value cap vs. CA's 2% Prop 13 cap.
Agent Commissions Edge Higher in 2025 Post NAR Settlement
Commission rates rebounded to ~5.49% in 2025. Rates rose in 39 of 50 states.