Recreational Land as an Investment: What the Data Shows and What It Does Not

By Seth Willyard, Blue River Realty

Recreational land can hold and gain value, and Oklahoma farm real estate as a whole rose about 55% between 2016 and 2026 by the USDA's estimate. But nobody publishes a return series for recreational tracts, land pays no income while you hold it, it costs money every year, and it can take a long time to sell. The honest way to buy it is for the use you will get from it, with any gain treated as a possibility and not a plan. We sell land, so weigh what we say accordingly; we would rather you buy with accurate expectations than with a number we cannot stand behind.

This page sets out what data exists, what the data leaves out, the costs and risks, and how the tax rules treat a sale. It is part of our Oklahoma recreational land guide. It is general information, not investment, tax or legal advice, and it makes no prediction about what any property will be worth.

What data exists

Four public sources describe land values in or around Oklahoma. None of them measures recreational tracts directly.

The longest of these, the USDA state series, puts Oklahoma farm real estate at $1,690 per acre in 2016 and $2,620 in 2026. That works out to about 4.5% a year compounded. The year-by-year table and its caveats are in Oklahoma land price trends.

What that data does not tell you

It is not a return on recreational land. The USDA figure values land by its use in agriculture. Recreational tracts are smaller, priced on access, terrain, timber and water, and sold to a different set of buyers. They may have done better or worse than the farm series. No public source says which.

It is before inflation and before costs. The USDA's Economic Research Service reports that the national farm real estate average rose 3.4% in 2026 but only 0.4% after inflation, and that inflation-adjusted values were stable from 2014 to 2020. A 4.5% average nominal gain is a much smaller real gain, and none of these figures subtracts taxes, interest, upkeep or selling costs.

It gets revised. The USDA first published Oklahoma's 2022 farm real estate value as $2,250 per acre and now carries it as $2,070. Its 2018 figure went from $2,000 to $1,800.

It is an average. The 2022 Census shows Pushmataha County's farm value up 45.5% from 2017 and neighboring McCurtain County's up 9.6%. A single tract can move against both.

It describes the past. In mid-2026, brokers surveyed by RLI and NAR expected price growth to slow, and the Kansas City Fed listed weaker farm income and loan repayment among the headwinds. Neither is a forecast we would rely on, in either direction.

What it costs to hold land

Land produces no dividend or rent unless you arrange one. Every year you own it, money goes out.

• Property tax. Modest on raw land in rural Oklahoma, but it never stops. See property taxes on raw land.
• Interest. If you finance, interest is usually the largest holding cost. Federal supervisory guidelines for banks cap loans on raw land at 65% of value, lower than for improved property, and land loans tend to be shorter than home mortgages. Work the numbers with how to calculate a land payment.
• Upkeep. Road gravel, boundary marking, a gate, clearing after storms, and liability insurance.
• Your own time and travel.

A full list with typical ranges is in the yearly cost of owning recreational land. Whatever the tract gains has to exceed the total of these before you are ahead in money terms.

Some owners offset part of the cost with a hunting lease, a grazing lease or a timber sale. Those are real options on some tracts, but they depend on size, location and what your deed and any covenants allow, and they change how the property is taxed. We make no claim about what any tract could earn.

The risks, stated plainly

It can be slow to sell. Land has no exchange and no daily price. Each tract is one of a kind and finds its buyer when that buyer happens to be looking. If you might need the money on short notice, land is the wrong place for it.

Selling costs come off the top. Oklahoma taxes deeds at 75 cents per $500 of consideration under 68 O.S. § 3201. Add title and closing fees, and an agent's commission if you use one. See closing costs on Oklahoma land.

Defects in what you bought. Missing legal access, a boundary dispute, a title problem or severed minerals with active leasing can hold a tract's value down for as long as you own it. These are avoidable with proper checks before closing; see the due-diligence checklist.

Local change you do not control. A clear-cut next door, a new subdivision, a road that the county stops maintaining, a change in a nearby lake's popularity. These can help or hurt.

Interest rates. The USDA's economists name interest rates and the prices of alternative investments among the forces that move land values. When borrowing is expensive, fewer buyers can pay your price.

Concentration. A tract is one asset in one county. It should not be most of anyone's savings.

Paying too much going in. The surest way to a poor result is to overpay. Small tracts carry a higher price per acre than large ones, and asking prices are not sold prices. Compare like with like using recreational land price per acre by county and what drives recreational land prices.

How a sale is taxed

The federal rules below come from IRS publications current in October 2026. They are a summary. How they apply to you depends on how you hold and use the land, so talk to a CPA before you buy if tax treatment matters to your decision.

Gains are capital gains in most cases. The IRS treats almost everything you own for personal or investment purposes as a capital asset. Hold it more than one year and a gain is long-term; one year or less and it is short-term. For tax years beginning in 2025, the long-term rates were 0%, 15% or 20% depending on taxable income, with the 15% rate starting above $48,350 for single filers and $96,700 for married couples filing jointly. Thresholds change yearly, and some taxpayers also owe the net investment income tax.

Losses on personal-use property are not deductible. This is the rule buyers most often miss. If the tract is your family's weekend place and you sell it for less than you paid, the IRS says the loss on personal-use property cannot be deducted. Whether a given tract is personal-use or investment property is a question of facts for your CPA.

Your basis is more than the purchase price. IRS Publication 551 lists settlement costs that become part of basis, including abstract fees, legal fees, recording fees, surveys, transfer taxes and owner's title insurance. Later capital improvements add to it, with extending utility service lines to the property given as an example. Keep every receipt; a higher basis means a smaller taxable gain.

Land is never depreciable. There is no yearly depreciation deduction on bare land.

Like-kind exchanges are limited to business and investment property. Section 1031 lets an owner defer gain by exchanging real property held for investment or used in a business for other like-kind real property, improved or unimproved. Property held primarily for sale does not qualify, and the business-or-investment requirement means a purely personal retreat does not fit. Do not assume an exchange is available without professional advice.

Oklahoma has its own income tax rules, which we have not covered here. Ask your CPA.

What tends to protect value

Nothing guarantees value, but some features make a tract easier to sell to the next buyer and harder to fault:

1. Recorded legal access and a road you can drive year-round.
2. A current survey with marked corners and clean title.
3. Usable ground: a building site, a route to it, and soil that will take a septic system.
4. A size and price that many buyers can afford.
5. Location relative to the things buyers travel for, such as public land, lakes and a reasonable drive from a city.

The improvements that add most, and those that rarely pay back, are covered in resale: what adds value to land.

A better question than "will it go up"

Ask what the land is worth to you if it never gains a dollar. If the answer is a place your family will use for twenty years, the purchase can make sense on those terms, and anything it gains is a bonus. If the only reason to buy is an expected profit, the lack of income, the holding costs, the selling costs and the absence of any reliable return data all argue for caution.

Three checks before you sign:

• Could you carry the payment, taxes and upkeep through several flat years without strain?
• Would you still want the tract if you had to hold it twice as long as planned?
• Have you priced it against comparable tracts, not against the state average?

Blue River Realty sells surveyed tracts with legal deeded access in Southeastern Oklahoma and offers owner financing. We do not promise appreciation and no one honestly can. If you want to see what is available, start with recreational land for sale in Oklahoma, read how owner financing works, or ask us for the current terms.

Frequently asked questions

Is recreational land a good investment?

It can hold value, but it is not a conventional investment. It pays no income on its own, costs money every year in tax and upkeep, can be slow to sell, and has no published return series. USDA data shows Oklahoma farm real estate rising about 55% from 2016 to 2026, but that measures farms, not recreational tracts, and is before inflation and costs.

Does land always go up in value?

No. USDA's economists report that inflation-adjusted farm real estate values nationally were stable from 2014 to 2020, and the national average rose only 0.4% after inflation in 2026. Individual tracts can fall in value because of access problems, title defects or changes nearby. Past increases in the state average do not guarantee anything about a particular property.

How much has Oklahoma land appreciated?

By the USDA's estimates, Oklahoma farm real estate went from $1,690 per acre in 2016 to $2,620 in 2026, about 4.5% a year compounded before inflation. County results vary widely, and earlier years have been revised downward after first publication. No public source tracks appreciation of recreational tracts specifically.

How is profit on a land sale taxed?

Generally as a capital gain. Land held more than a year qualifies for long-term rates, which the IRS listed as 0%, 15% or 20% depending on income for tax years beginning in 2025. Purchase costs such as surveys, recording fees and title insurance, and later capital improvements, add to your basis and reduce the gain. Ask a CPA about your situation.

Can I deduct a loss if I sell recreational land for less than I paid?

Not if it was personal-use property. The IRS states that losses on personal-use property are not deductible. Land held as an investment is treated differently. Which category your tract falls into depends on how you actually held and used it, so settle that question with a CPA before you buy if it matters to you.

Can recreational land produce income?

Sometimes, through a hunting lease, a grazing lease or a timber sale, where the tract's size, location, deed and covenants allow it. Small tracts often produce little or nothing. Income also changes the tax treatment of the property. We make no estimate of what any tract might earn; look into it tract by tract with local advice.

Sources

1. USDA National Agricultural Statistics Service, Land Values 2026 Summary — released July 31, 2026: Oklahoma farm real estate $2,620 per acre, up 3.1%; 2022 value of $2,070; revision policy.
2. USDA NASS, Land Values 2020 Summary, 2018 Summary and 2022 Summary — the 2016 value of $1,690 and the first-published 2018 and 2022 figures.
3. USDA NASS, 2022 Census of Agriculture, Oklahoma County Table 8 — land and buildings value per acre, 2017 and 2022, state and counties.
4. USDA Economic Research Service, Farmland Value — nominal and inflation-adjusted change in 2026, stable real values 2014 to 2020, interest rates and alternative investments as drivers (updated September 23, 2026).
5. Federal Reserve Bank of Kansas City, "Steady Tightening of Agricultural Credit Conditions Persists," August 14, 2026 and "Continued Resilience in Farmland Values," June 3, 2026 — ranchland values, farm income and repayment headwinds.
6. National Association of REALTORS, "Land Market Demonstrates Price Resilience," May 5, 2026 — RLI and NAR Land Market Report: recreational price growth of 1.9% in 2025; slower growth expected.
7. 12 CFR Part 365, Subpart A, Appendix A (Cornell Legal Information Institute) — supervisory loan-to-value limit of 65% for raw land.
8. Oklahoma Statutes, Title 68, § 3201 (Oklahoma Senate compilation) — documentary stamp tax of $0.75 per $500 of consideration.
9. IRS Topic No. 409, Capital Gains and Losses — capital assets, holding periods, 2025 long-term rate thresholds, personal-use losses not deductible (reviewed September 24, 2026).
10. IRS Publication 551, Basis of Assets (revised December 2025) and IRS Topic No. 704, Depreciation — settlement costs and improvements included in basis; land is never depreciable.
11. IRS, Like-Kind Exchanges: Real Estate Tax Tips — section 1031 applies to real property held for investment or business use; improved and unimproved real property are like-kind (reviewed May 1, 2026).