The chart shows the median sale price for all lots that are listed in the MLS and that have 1,500-4,500 square feet. Most of them are residential lots. Unfortunately, many listings do not include zoning information so I simply included all lots.Land prices are highly sensitive to home prices. Why? Building costs don't change much from year to year. If the price of a home rises by $100,000, the price of the vacant lot next door is likely to rise by the same $100,000 increment. On a percentage basis, the increase in the lot price will be much larger than the increase in the home price. That's why lot prices have fallen more than 60% while home prices have fallen only 10%-20%.
Keep in mind, too, that most lots are priced under the assumption that they will be developed with multiple units. That's why the median lot price has fallen by roughly $500,000 while the median home price has fallen by only around $150,000.
