Thinking of real estate investments, we think rental homes and commercial properties. But what about vacant land?
For example, if a large plot of land is getting ready to go up for sale next to you, piquing your interest in land investment. Like anyone looking to make a financial move, you should start researching the pros and cons of making this type of investment.
Related: Real Estate Investment: How to Be Smart About it
Benefits of Investing in Vacant Land
It won’t take long to come up with some good reasons to invest in land. Consult with a real estate agent about purchasing land. The benefits are:
1. It’s a Limited Resource
Nobody is making any more land. Unlike products that come from the factory, there’s a limited amount of land. This one reason makes land insanely attractive to investors. As the famous phrase goes ” buy land they ain’t making it anymore. “
2. Requires Little Maintenance Compared to Other Real Estate Investments
One of the advantages of vacant land is there are no buildings.
There’s no fixing roofs, clogged plumbing or replacing the features at every tenant turnover. Nobody is living on the land. It can’t get any simpler.
3. You Can Start Cheaply
Although you’re not going to buy 100 acres of land inexpensively there are some other types of properties that you can get started with.
The money that you’ll need to spend will vary based upon the goal you have for your land. Note you should know your goal before buying.
4. It Can Be Profitable
Besides your benefit, there’s no reason to invest if there’s not some sort of financial gain. Amazingly, there are several ways to profit from land.
How to Make Profit From Vacant Land
As a potential property buyer, you’ve thought about land but haven’t come up with a concrete goal. Here are some ways you will get profit
Buy and Hold
Just like you can with stocks or other like investments, you can apply the buy and hold strategy to land. If you get a good deal on land now and hold it for twenty years you can sell and walk away with a profit later.
Of course, just like stock market investments, there are no guarantees.
Another thing you can do is lease the property while you buy and hold, making your investment pay for itself over the long run.
Lease to a Farmer
If you get your hands on a good piece of agricultural land for the right price you’ve found yourself a good investment.
Agricultural land has historically produced bigger returns than stocks, bonds or mutual funds over the long run. However, it’s going to be more expensive than other types of vacant land and may be harder to get started with if you don’t have a pile of cash just lying around.
Buy Low, Sell High
Just like you can flip a home you can also flip land. This, of course, will highly depend on the area you live. If you’re able to pull it off you may be able to buy land at a cheap price during the slow time of the year and then relist for more at later date.
More to Consider:
Vacant land can be a great investment but before you go out and buy yourself a piece of property you need to know what to look for.
You need to visit the land in question and also find out about administration laws, any environmental concerns among others.
Moreover, you’re just getting started your best bet is to heavily research and find a real estate agent who is knowledgeable and can guide you in your search like Kenya Homes.
Also, remember that just like other investments buying vacant land is not a get rich quick scheme. Instead, it’s a solid investment when done properly and by the right person.