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Land value's what causes them to change
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thereaper
Posted 5/2/2023 13:27 (#10213132 - in reply to #10211383)
Subject: RE: Land value's what causes them to change


Ol’ Wisco
I believe this is a question that has many scratching their head. One would venture to believe a +5% cap rate is needed considering the RFR is near to that. But portfolios holding land are looking at long term avg returns, an inflation hedge, a hard asset vs paper or some or all of the above.

Big problem is that all these measures presume a ZIRP (or near) regime being ushered back in a relatively near time frame.

IMO anyone using a cap rate sub the RFR for assumed holding period is not truly looking at value vs value. It is definitely an interesting time in the land market that’s for sure

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