Land increases in real value (beyond inflation) aswell. This is due to people building roads nearby, schools nearby, nicer houses nearby, etc. It's effectively the old adage 'location location location'.

Currently another big driver of land value is zoning. But it isn't the only one. And until society starts degrading hard, the other drivers aren't going to slow down either. maybe with an exception for suburbia where the roads will need replacement even though the area doesn't raise enough tax revenue to pay for the replacement roads.