It's a bit more complicated because markets are not perfectly rational, but also because of rational expectations and speculative movements. When there is an e

It's a bit more complicated because markets are not perfectly rational, but also because of rational expectations and speculative movements. When there is an expectation that zoning laws will be changed to allow higher density, or when there's an expectation that there will be a growing market for high-end real estate, the ask price from land owners usually rises. The markets are not 100% efficient in the real world, outside of the simplest economic models.