Everyone touts about the benefits of investing in real estate, but what about land? The general consensus has always been that land is not a worthwhile investment. Why? People falsely believe that land won’t produce income. It just sits there. It’s a boring investment. Land can produce a serious cash flow, and right now, it’s one of the best investments you can make. Here are some few reasons why you should invest in land.
- Land is Limited: Why invest in land? Because they aren’t making any more of it. Land is limited in quantity, which makes it a valuable resource. And if you choose to invest in a growing area, people will be vying to get their hands on your lot. As the population continues to grow and cities are expanding outward, land will become scarce and therefore, more valuable. Whether it’s a couple looking to build their dream home or a corporation looking to develop a new shopping plaza, there will always be demand for land. In areas where growth is high, demand will be even higher. The true value of a land investment can be realized in the long-term, when vacant lots in the surrounding area have all but disappeared and demand is at an all-time high.
- No maintenance is required: The land is just there increasing in worth without maintenance of any form compared to a house already built for rent which will always require maintenance in one way or the other. Most times, you really only need to know one thing: “Is the property suitable for building?” As long as someone else can build on the land if/when they want to, a huge part of the battle is already won.
- Land is Easy to Invest In: Investments can be complicated. There’s a learning curve no matter which vehicle you choose. But land is a relatively easy beast to tame. You don’t have to worry about renovations or construction. You don’t need to be an expert in flipping houses. More often than not, the only thing you need to be concerned about is whether or not the land is buildable.
- They Aren’t Making Any More Of It: Most people don’t think of vacant land this way, but the reality is – land is an extremely valuable resource with limited quantities available. Especially when you purchase land in the path of growth, you will find yourself with a finite asset that a lot of other people want to get their hands on. Stocks, bonds, mutual funds and 401Ks all make sense in certain scenarios, and so does land. If you go into this with the intent of holding the right property for the long-term, it can make a lot more sense (and be a lot more profitable) than any other retirement vehicle out there.
- Land is a “Hands Off” Investment: Maybe you like the idea of investing in property, but don’t want to have to deal with finding tenants, calling a plumber at 3AM or any one of the other hundred issues that come along with renting property. Real estate investing is still a lucrative option, but it comes with its own fair share of headaches. It also takes a great deal of experience to understand the ins and outs of this investment option. Land doesn’t need to be “babysat”. It’s completely hands off. You can let the property sit there for 5, 10, or even 20 years, and nothing will happen. It won’t deteriorate, and it won’t fall into disrepair. As a landowner, you never have to lift a finger to do anything with your property – unless you want to. It’s the ideal investment vehicle for anyone looking for a hands-off investment.