When people think of investing, they may consider real estate or stocks, but a lot of people overlook the benefits that can come with investing in land. Purchasing land as an investment can be a smart place to put your money and requires less thought than investing in real estate properties. Land often gets overlooked as a viable investment since people sometimes assume that either there isn’t a big market for buying land or they assume that the process is too complicated, but there are actually many benefits to this type of investment.
Build in the Future
Buying land doesn’t always have to be done with the intention to sell it. Sometimes, buying land that you plan to use one day can be a wise choice. For example, maybe you live in the suburbs now but you dream of one day living out your retirement in the country. This is a scenario where it might be worth looking for and purchasing land now. That way, when you’re ready, you’ll already have the land you need to build on. Afterall, there is only so much land available, so the longer you wait the harder it may be to find.
Minimum Work
Unlike investing in a fixer upper, buying land comes with very little, if any, type of work to maintain it. As a landowner you don’t have the same costs that come with being a homeowner like costly repairs, regular maintenance, HOA fees or wear and tear over time. Once you’ve purchased your land there’s very little you need to do in order to maintain that asset. This allows you to hold on to the land for as long as you’d like without incurring any extra costs.
Affordable Long-Term Investment
While land is definitely an appreciating asset, it takes time to really get the most out of this type of investment. If you’re interested in getting a quick return on your investment then it may be better to look at real estate investments instead. However, if you’re okay with holding onto your land for a little bit and being patient, then you could see a high return on it in the future. This is especially true if you happen to get a good deal on your land or if interest for the area your land is in has increased a lot. Additionally, the taxes on land versus other assets like real estate are significantly lower, so you can hold onto your land for a long time without worrying about extra costs.
Income Opportunities
Of course like with any investment, the ultimate goal and hope is to make money. Investing in land is a great way to make money, but not only with the final sale. A lot of people think of the passive income potential with rental properties, but the same approach can be applied to land that you have invested in as well. When you invest in vacant land, even if it’s completely undeveloped, you have a lot of options when it comes to making money while you hold onto it.
Some landowners will opt to develop their land to increase their return when they eventually do sell, others may lease it out for agricultural purposes or as storage, like for storing trucks, RVs or boats for example. Additionally, the beauty of owning land is that you can decide to do all of these things depending on how large of a property you have. These are just some of the ways that you can earn a passive income from your land investment before you sell it. During this time you’ll be making additional money while your land is also increasing in value overtime, making this approach to owning land a very worthwhile investment.
Low Risk
The process of owning land is a lot more straightforward than other types of investments. There is only a finite amount of land left, and unlike other, possibly more risky types of investment, land will always appreciate over time. Additionally, since there’s no potential maintenance or need to do any kind of renovation when you purchase land you’ll be able to rest easy knowing that it’s always in a sellable condition. Working with a real estate agent during this process is another way to greatly reduce your risk when investing in land. Although the process of buying land is fairly straightforward, having a real estate agent on your side will ensure that everything is done correctly in order to secure your legal ownership of the land.
Less Competition
When it comes to the housing market there is a lot of competition right now and that is especially true when it comes to investment properties. If you prefer not to deal with competing buyers or bidding wars, then you’ll be glad to know that there usually isn’t as much intense competition when it comes to buying land. This is often because buying land is a more long term investment than purchasing a property, so those looking for a fast return are going to stay away from this area. This means that it’s easier to search for land to purchase since you’re not competing with as many buyers and you’re also able to purchase land for a lower amount than a property!
Endless Possibilities
Ultimately, investing in land has endless possibilities and it’s up to you what you decide to do with it. Whether you simply want to hold onto the land until you’re ready to sell it, or you want to parcel it out and sell some of it over the years, there’s a lot of flexibility and potential that comes with land investments.
As you can see, there are many benefits that make buying land a smart move. With the right help, buying land can also be simple and hassle-free. Whether you’re wanting to purchase land as a long-term investment or you’d like to leverage it in the near future as a passive income, we can help you navigate this process and see the benefits!
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Kevin McLemore is a second generation real estate broker, having grown up in the business. The McLemore Group is centered around the strong bond that Kevin has with his father, Dan McLemore. They have been working together selling land, homes, and commercial projects for over 20 years.
Kevin specializes in helping sellers of unique properties get maximum value for their property with as little headache as possible. He has brokered transactions throughout the greater Charlotte region including the upstate of South Carolina.
Copyright © 2024 The McLemore Group - All Rights Reserved.