Shopoff Realty says rising costs put pressure on land values
XLRE•Shopoff Realty Investments’ October 2026 analysis says rising costs and buyer incentives are reducing land values. New-home incentives reached about 7-8% of prices, while Inland Empire industrial rents fell to $1.01 per square foot monthly in the third quarter.
1. Costs pressure land values
Shopoff Realty Investments’ October 2026 market analysis says rising costs and buyer incentives are reducing land values. New-home incentives reached approximately 7-8% of prices, compared with a historical range of approximately 3-3.5%, squeezing builders’ land budgets.
2. Inland Empire industrial market
Industrial vacancy eased to 7.2% in the third quarter, while average taking rents fell to $1.01 per square foot monthly. Availability rose to 12%, and the construction pipeline expanded 34.8% from the previous quarter to 8.3 million square feet.
3. Financing remains limited
Construction and land financing remain limited and expensive despite easing bank lending standards, with capital concentrated around experienced sponsors.
