Is Washington Land a Good Investment?

Investing in Washington land has become an increasingly attractive option for many savvy investors. The Evergreen State's diverse landscapes and robust economy offer unique opportunities in both rural and urban areas. According to recent data from the USDA, Washington farmland values have shown steady growth, with an average increase of 5.3% annually over the past five years. This trend is particularly notable in Eastern Washington, where irrigated cropland has seen values rise by up to 7% year-over-year in some counties. Additionally, a report by the Washington State Department of Natural Resources indicates that timberland prices have climbed by an average of 3.8% annually since 2018, reflecting the state's strong forestry sector. These figures suggest a robust market for raw land in Washington, but potential investors should consider various factors before making a decision.

Overview of the Washington Land Market

Across Washington, land prices vary widely based on location, terrain, zoning and intended use. Prices tend to be highest around booming cities like Seattle and Bellevue on the I-5 corridor. More remote recreational and agricultural land sells for far less per acre.

As of late 2022, the median price per acre for vacant land in Washington is around $7,500. However, prices in King County average over $60,000 per acre. Even bare land within an hour of Seattle can sell for $20,000 to $40,000 per acre.

Eastern Washington has much lower land prices, averaging $2,500 to $5,000 per acre. The most affordable vacant parcels tend to be in rural counties far from major highways and cities.

Like all real estate, Washington land prices fluctuate over time. The market slowed in 2022 as interest rates rose. Long-term, land values have appreciated steadily, roughly doubling each decade since the 1990s.

Strong population growth is the main driver of real estate demand across Washington. Seattle and the Puget Sound added over 235,000 new residents between 2010 and 2020. Spokane, Yakima, the Tri-Cities and other regions saw double-digit growth as well.

As the supply of buildable land shrinks, especially near urban centers, vacant parcels become more scarce and valuable to developers. Agricultural acreage has also increased in value with rising global food demand.

Prime Locations to Buy Land in Washington

Certain regions stand out as potentially rewarding places to buy land in Washington right now:

Seattle Metro Area 

Despite high prices, the steep upward trajectory of land values around Seattle makes it appealing. Any parcel within an hour drive of the city core could eventually be developed into housing, warehouses or commercial space once zoning allows. Even marginal acreage here can become extremely valuable over a decade-plus timeframe.

Spokane 

As the main urban hub in Eastern Washington, Spokane offers more affordable land prices but still has strong growth potential. The metro population rose 13% from 2010 to 2020. Outlying areas like Spokane Valley are booming. Farmland near Spokane also makes a strategic investment for future development.

Tri-Cities 

Made up of Kennewick, Pasco and Richland, the Tri-Cities area is among Washington’s fastest-growing metros. Tech and healthcare employers are driving rapid expansion. Bare land outside city limits can still be purchased for $5,000 per acre or less before prices catch up with demand.

Vancouver, WA 

Located just across the Columbia River from Portland, OR, Vancouver has evolved from a sleepy bedroom community into a mid-size metro area. Clark County population jumped 21% from 2010 to 2020. Though not cheap, land in Vancouver offers proximity to Portland-area job centers while being in Washington.

Yakima Valley 

This agricultural region has a booming wine industry around Yakima and Tri-Cities. For investors, vineyards, orchards and irrigated farmland have significant upside from rising global food demand. Water rights are critical when buying acreage here.

Olympic Peninsula 

Land prices are still reasonable around Olympic National Park and on the Pacific Coast. Development is limited, but this is a prime area for people seeking recreational retreats. Climate change may eventually create high-end wine growing potential here as well.

Eastern WA Rangeland 

Large plots of cattle grazing acreage are found across Eastern Washington, often selling for $1,000 per acre or less. This can serve as an inflation hedge and potentially transition to other uses long-term. Recreational buyers also seek rural properties.

Factors to Consider When Buying Land in Washington

Washington's land market has many complexities. Several key factors should be evaluated before purchasing any vacant parcel:

• Zoning – How the land is currently zoned places major limits on what can be built there. Seeking rezoning may be difficult and lengthy. Properties outside city growth boundaries often have more restrictions.
• Access – Confirm there is legal ingress/egress to the parcel. Landlocked parcels have very limited uses without granted access rights.
• Utilities – Extending municipal water, sewer, electric and gas lines can be costly. Lack of utilities may rule out development completely.
• Environmental Issues – Buyers inherit liability for any existing contamination. Old structures may contain asbestos or lead paint. Surveying for wetlands is advised.
• Water Rights – Active water rights determine the use of land for irrigation. Ensure water rights transfer with the sale for acreage intended for agriculture.
• Timber Value – Standing timber adds value to forested land. Getting professional cruising to estimate merchantable wood volume.
• Mineral Rights – Subsurface rights for mining coal, metals, oil and gas may be sold separately from the land in Washington. This affects value if these resources are present.
• Easements – Be aware of any utility, access or conservation easements that may limit use of all or part of the property.
• Taxes - Property tax rates vary widely across Washington counties and cities. Higher tax rates impede development in some cases.
• Permitting - Extensive permitting, environmental studies and fees often apply to building residential or commercial projects. Navigating the red tape takes expertise.

Weighing all these factors helps determine a parcel's realistic market value and investment upside. The technical complexities make it advisable to consult a local real estate attorney before buying land in Washington.

Tips for Buying Land Wisely

To gain and maximize returns on land over time, we recommend following these best practices:

• Research recent comparable sales to estimate fair market value per acre in the area you are buying in. Prices can vary drastically between neighboring parcels.
• Engage professionals. Hire an experienced real estate attorney for title search, review of sale contract terms and closing. Use licensed surveyors and contractors as needed.
• Be conservative in financial projections. Development costs tend to run over estimates. Markets fluctuate unpredictably. Land can take years or decades to realize full returns.
• Look for discounted properties. Distressed sales, auctions, foreclosures, and motivated sellers offer opportunities to buy below market value. We specialize in this niche.
• Purchase usable acreage if possible. Oddly shaped or landlocked parcels have limited appeal and value. Lack of access or utilities can kill development potential.
• Buy future growth path land. Areas expected to expand near cities and infrastructure make solid long term investments.
• Invest for multiple potential uses. A parcel that can support residential, commercial or industrial use has more upside over time as markets shift.
• Study zoning carefully. Seek parcels where you can obtain approvals for intended use. Hold if necessary until zoning changes in your favor.
• Consider recreational land. Waterfront, hunting and off-grid remote parcels draw premium pricing as people increasingly value experiences over material goods.

With the right property, patience and savvy, Washington land represents an asset class that can deliver lasting wealth for investors. As development pressures rise across the state, the long term case for owning natural resources remains strong.

Is Washington Land Worth the Investment in 2023?

All real estate carries risks, and vacant land is among the more speculative subsets. However, Washington still offers appealing characteristics for those looking to buy land at reasonable cost and achieve solid gains over a 5-10+ year time horizon.

The state's growing population, thriving industry clusters around aerospace, tech and agriculture, and natural amenities will continue to drive demand for well-located plots of dirt.

With careful research, purchases at discount to market pricing, and allowing time for broader trends to play out, quality land acquisitions should continue rewarding investors in Washington.

At Land Boss, we seek to buy land at favorable prices from motivated sellers and resell to builders, developers and other buyers seeking high-potential parcels as the market strengthens. Contact our professionals to learn more about our current inventory of Washington land for sale.

Final Thoughts

Washington offers much to appreciate for land investors - thriving industry, natural beauty, and appeal as a place to live. Yet the complexities of the local land market require diligent research and patience to realize returns. By targeting key growth regions, buying at discount when possible, and utilizing professionals, land can remain a solid long-term investment in Washington. With the right strategy, vacant parcels in the Evergreen State should continue rewarding those with the appetite and acumen to build wealth from the ground up.

Frequently Asked Questions (FAQs)

What types of land make the best investments in Washington?

Parcels near expanding cities like Seattle, Spokane, and Vancouver have excellent appreciation potential as development pushes outward. Agricultural acreage in wine regions and Eastern WA offers value from rising food prices. Waterfront and recreational properties also attract premium prices as people increasingly prioritize experiences.

What is the timeline to profit from investing in land?

It typically takes 5-10 years or longer to realize substantial returns from vacant land. Appreciation tends to be gradual until a major zoning change or infrastructure project triggers a spike in land values. Patient investors often see the biggest gains.

What are the main risks of buying Washington land as an investment?

Market fluctuations, zoning restrictions limiting development, lack of access or utilities, environmental clean-up costs, and property taxes can all reduce land value and returns. Performing due diligence is critical before purchasing any parcel.

What is the best strategy for buying land at a discount in Washington?

Seeking distressed properties, auctions, foreclosures, and motivated sellers provides opportunities to acquire land below market rates. We specialize in sourcing and negotiating discounted deals from stressed owners.

Should I buy land on my own or use a company like Land Boss?

Novice investors often benefit from the expertise of an experienced land acquisition firm. We handle valuation, negotiations, due diligence, closing, and marketing so buyers can passive invest in targeted high-upside properties.

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