| The Real Estate Center at Texas A&M University found an interesting trend—the average price for a thoroughbred yearling racehorse sold at the world's top auction is a consistent predictor of trends in Texas land prices two years down the road. Dr. Charles Gilliland, who has tracked Texas land prices for three decades, compared his findings with data from the Keeneland September Yearling Sale. It's the best source because it provides an “instant” reading of demand for luxury items, he says. The positive correlation between the info is 0.820, but when horse prices lag two years behind land, the correlation rises to 0.916. In other words, the latest auction numbers indicate what lies 24 months ahead in the Texas land market. So what are the horses saying? Nay. As in, nothing good— prices for thoroughbred yearlings peaked in 2007 and continue downward. |
From the Horse’s Mouth
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Charles Gilliland, The Real Estate Center
