Kurt from PA asks,
Bill, Two questions: 1. What's your opinion on planting fields of switchgrass for deer bedding? 2. Do you think that recreational land, even at the current high prices, is still a good investment? Thanks! Kurt
Topic: Hunting Land Investment Quality:
I have written a number of times about the suitability of switchgrass for deer habitat. If you have not tried it, please use the search function on the site (the magnifying glass on the main navigation line) and search under “Switchgrass”. You will find a few discussions about switchgrass. In summary, I have planted it a lot and hunted over it a fair amount. I have not seen the deer use it nearly as much as they use permanent habitat options like trees, shrubs and browse species in the areas where I have planted it.
But, these have all been in areas where there was some permanent habitat in the immediate area. I guess if there was nothing but pasture land, then switchgrass would be a big improvement over that, but not as good (long term) as trees and shrubs.
The deer have passed through the switchgrass with regularity even in daylight, but they didn’t seem to actually live in it (bed in it). Also, switchgrass tends to die out after a few years if you don’t manage it carefully. Plus, there is browse that grows in timber and shrub plantings but in a good switchgrass planting there is none.
So, while I don’t plant switchgrass anymore, myself, I can understand why people are tempted to plant it – it is grows faster than trees and shrubs. I don’t advise anyone to plant switchgrass when I am consulting with them. I advise planting permanent habitat (trees and shrubs) instead. Takes longer but the results are better.
You can plant switchgrass, of course, but also plant the majority of your open areas to more permanent habitat types.
Regarding hunting land as an investment: I wish I knew where things are going. I am buying it right now (or at least trying to) and I am uncomfortable when I see the price jump 25 to 30% in one year. That is great if you already own it, but disconcerting when you are thinking of buying it.
Here’s what I have decided for myself: I don’t believe those kinds of gains are anywhere near sustainable. I do think there may be one more year of historically high gains because the supply of good properties on the market is so low that it creates a feeding frenzy of buyers when something comes available. I think the supply will increase in the next year as people see the price growth slowing and they decide to cash out by selling this highly appreciated asset.
So, my guess (nothing more than a guess, but this is where I am putting my money) – the price will likely go up fast one more year and then stabilize for a while as the supply on the market starts to rise. I also think that interest rates rising will slow some of the panic demand that seemed to be happening as everyone wanted to get in before the rates went up.
What happens long term? My guess is that recreational property will ultimately fall back to the long-term appreciation of roughly 7 percent that we have seen since the mid 90s when the farm crisis cleared up and there became a distinction between recreational land and farm land. Before that, there was no such thing as “recrational land”, just “land”.
Sometime soon, the price should stop rising fast and will rise much more slowly. I would not bet on it actually dropping though – at least I am not.
I am still looking to buy because I want land and my investment won’t be short-term. If I was looking purely for a great short-term investment, I might look for some hard asset that didn’t make a crazy upward run over the past two years. Maybe there isn’t one! I don’t know much about investing in anything but hunting land, so it would be a mistake to take general investment advice from me! Good luck. (3/2/22)