Lakewood Real Estate News

(by Dave Emerson) In the midst of all the current bad news, we found some good news for you!

One class of real property is up almost 9% from a year ago. The price increases are shutting out some new buyers! Can you guess what it is?

According to an article in Tuesday, November 18th’s Christian Science Monitor, it’s farmland.

In Iowa, farm land is up 18% from a year ago. In South Dakota it’s up 21%.

Several reasons are cited, but the primary one is an increase in profits from agriculture. A large part of that results from the big push for ethanol produced from corn. That drives up corn prices, which in turn drives up beef prices, among other things. It’s also driven up our cost of groceries. More unintended consequences from our beloved federal government!

Here in California, however, up until a few years ago farmland prices across the state were being driven up by contractors buying farms to build new homes. Obviously, the price of land for housing has dropped dramatically over the last few years.

So, if you’ve been hankering for a dairy farm outside of Victorville or to grow cotton outside of Fresno, you may be looking at your golden opportunity. In 20-30 years, you should be able to sell out to a developer & retire, or rebuy farmland further out of town.

That’s what dozens of Dutch dairy farmers have been doing as long as I’ve been alive. When I was growing up in Lakewood what’s now Cerritos was Dairy Valley. No valley, but lots of dairies. Those prudent Dutch farmers sold out & moved to Chino back in the late 1960s. 20-30 years later they repeated the process, moving even further out.

Before moving to Cerritos those dairy farmers were farming in Paramount & Bellflower.  Lakewood was pretty much all bean fields back then.

In the 1930s the “Lakewood Village” development began selling 60′ x 120′ buildable lots on farmland north of Carson.

As Douglas ramped up aircraft production during World War II, housing tracts began sprouting up on farmland.

After the war was won, thousands of Vets were lured to “Tomorrow’s City Today,” sprouting on the beanfields that are now Lakewood.  My Dad was one of them.  About $10,000 for a three bedroom Lakewood home that was worth $550,000 two years ago and is still worth well over $400,000 today.

Over the long haul, very few investors have lost money in real estate. It’s the short haul where folks get into trouble.  Especially if they buy homes they really can’t afford with crazy loans they don’t understand.

Political humorist Will Rogers had a lot of great sayings that relate to our current economic turmoil:

An economist’s guess is liable to be as good as anybody else’s.

Ancient Rome declined because it had a Senate, now what’s going to happen to us with both a House and a Senate?

I don’t make jokes. I just watch the government and report the facts.

We always want the best man to win an election. Unfortunately, he never runs.

If Stupidity got us into this mess, then why can’t it get us out?

But my favorite is Rogers’ oft-quoted mantra about investing:

Buy land, God ain’t making any more of it!

Just ask those corn farmers in South Dakota. Or those retired milionaire dairy farmers who started out in So Cal’s Dairy Valley years ago.