Land investment is generally viewed as something which is only profitable to real estate developers who acquire massive parcels of land for commercial or residential development. Nothing could be further from the truth. Investing in land is actually one of the greatest investment strategies available for anyone looking to build long-term wealth. Vacant land is one of the most untapped and misconstrued investments in the world. Here are 7 reasons why you should consider making land your nest investment.
- No Need to Enhance the Property
Land investment requires no additional inputs. Forget about construction and renovations. There is no particular expertise or skill set required. In most land investment scenarios, there’s really only one thing you need to know: “Is the property suitable to build on?” As long as someone else down the line can build on or develop the land if and when they desire, then your investment is already secure.
- Land is a “Hands-Off” Investment
As opposed to owning buildings and other rental properties, which entails fielding constant issues such as difficult tenants, plumbing, mold, lawn care and heating/cooling problems, vacant or “raw” land doesn’t require your active participation. Following your initial purchase, land tends to remain in its original state, causing you little or no headaches.
- Land Investors Have Very Little Competition
Most real estate investors deal in developed assets like houses, apartments or commercial spaces. These are assets which are extremely popular amongst investors, which drives prices upwards and creates an enormous amount of competition in the marketplace. Therein lies the advantage in land ownership; most investors are looking for a faster turnover and are unaware of the long term potential for returns.
- Avoid Dealing With Banks and Mortgage Companies
As land owner you might be looking to generate an income stream in the near-term. One avenue available is an instrument called seller financing. In this scenario, you are in essence becoming your own bank. However. unlike a bank or mortgage company you are not actually advancing any money to the borrower. Rather, you are granting the permanent use of your property and accepting payments for it for several months or years into the future. These payments will typically include principal, interest, and service fees for the ongoing life of the loan. (While you’re here, you can explore seller financed land for sale in North Florida.)
- Land is Very Inexpensive to Own as a Long-Term Investment
If you are simply looking to park your cash somewhere and forget about it for a while, vacant land is the perfect asset. When you purchase land for the right price, there are no mortgage payments, no utility costs and property taxes are extremely low. The cost of property insurance, if you choose to purchase it, is typically nominal.
- Landowners Have Peace of Mind
Land is a long-term, tangible asset that is usually considered immune from wear and tear, and is not subject to depreciation. It is also fairly secure.
One thing is for certain—no one is producing any more land. As a commodity, it is both finite and fixed. With limited quantities available, purchasing land in the path of economic growth now will furnish you with an extremely high-demand asset in the future. While stocks, mutual funds and retirement portfolios are sound investments in certain scenarios, holding the right property long-term can yield greater returns than any other retirement vehicle.
With over 40 years of experience in Real Estate/Construction, 727 Land Book can assist you buying land and Real Estate. View Current Listings or Contact Us.