ALBUQUERQUE, N.M. — As is the case in many other western states, New Mexico is seeing an increase in interest among buyers for ranch and farmlands, as the COVID-19 pandemic forces many Americans to reevaluate exactly what kind of environment they want to be their home.
Real estate brokers specializing in ranch and farmlands told the Journal they’ve had a surge in the number of people looking to purchase property, especially those from large urban areas in states like California and New York.
“There’s just a mass exodus of people getting out of the cities,” said Greg Liddle, New Mexico territorial manager for Hayden Outdoors.
Ranches are seen as a safer alternative during a pandemic, Liddle said, and more people are moving to these properties full time rather than making them second homes.
And it’s not just New Mexico. States across the Mountain West – such as Colorado, Idaho and Montana – have reported similar growth in demand for large ranchlands.
Brokers cite multiple reasons behind the growth, but nearly all the reasons tie back to COVID-19, which has upended nearly every sector of the American economy.
Part of the demand stems from the large number of workers now telecommuting using applications like Zoom and Skype. A Stanford University study published in June found around 42% of the U.S. labor force was then working from home full-time.
Liddle said he’s had clients from technology companies interested in purchasing property, since it may be years before they return to an office environment, if ever.
However, he said the land market in New Mexico is attracting “all walks of life,” due to low interest rates combined with the state’s comparatively low prices on property.
“I don’t know of a broker, small or large company, that’s not seeing a huge uptick in business,” he said.
The type of properties sought after by buyers also varies. Some feature modest homes on small plots of land, while other have huge homes surrounded by thousands of acres worth millions of dollars.
And many advertisements for properties focus on the recreational opportunities rather than the agricultural ones. Robert Martin, a Santa Fe-based broker specializing in ranchlands, said it’s becoming more rare for someone to exclusively focus on just one type of revenue.
“You’ll see people who their main interest might be elk hunting, but yet they’ll still run some cattle,” Martin said. “You’re seeing people from both sides.”
Martin added the influx of non-agricultural families buying ranchland would continue a similar trend seen in New Mexico over the past couple of decades.
But while the demand for ranchlands in New Mexico is similar to nearby states, COVID-related restrictions have created additional complications for some.
John Diamond, a broker for Beaverhead Outdoors in Elephant Butte, said the state-mandated 14-day quarantine – requiring those entering New Mexico from another state to quarantine for two weeks- has deterred some buyers from closing deals, since they’re unable to examine the property firsthand before buying.
He said COVID-related restrictions in the state put New Mexico at a disadvantage compared to neighboring states seeing a similar increase in demand.
“It’s actually hurt my business,” Diamond said. “We’re missing the boat in New Mexico.”
Other brokers said that while restrictions do create complications in the selling process, there are ways to adapt. Liddle said he has clients sign a “contract contingent upon inspection,” meaning they can get a refund on their down payment if they’re not satisfied.
And while the demand for ranching properties has exacerbated an historically-low supply of inventory, brokers said they don’t see the trend letting up so long as social distancing remains in effect. With months to go before a vaccine is expected to be widely distributed, that could be a while.
Liddle also said New Mexico’s low supply and low prices for land make it a desirable investment for some wanting harder assets in the event of an economic decline.
“You can’t get hurt with dirt,” he said.