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In the world of real estate investment, land often takes a backseat to flashy residential and commercial properties. However, for those in the know, land investing is a hidden gem that offers incredible potential for wealth accumulation and financial freedom. In this blog, we’ll dig deep into the world of land investing, exploring what it is, why it’s worth considering, and how you can get started on your journey to becoming a land investor.
What is land investing?
At its core, land investing involves purchasing and holding undeveloped or underutilized land with the intent of profiting from it in the future. Unlike other forms of real estate, land doesn’t come with the complexities of structures, tenants, or property management. Instead, it’s all about recognizing the value potential in the raw, untouched earth.
Why should I even consider land investment?
Scarcity and Finite Supply: They aren’t making any more land, and as the population continues to grow, the demand for usable land increases. This basic economic principle makes land an attractive long-term investment.
Tangibility: Land is a tangible asset that you can see and touch. You’re not relying on the success of a business or the whims of a housing market. Land will always be there.
Less Competition: Compared to residential or commercial real estate, there’s often less competition in the land market. This can mean more favorable terms and pricing for investors.
Multiple Income Streams: Land can generate income in various ways, including leasing for agriculture or recreational use, subdividing and selling in smaller parcels, or holding for long-term appreciation.
How to get started in land investment:
Any form of investment, big or small, can be intimidating. Beginning something new can be difficult and showcase challenges, but here are a few times on how to get started!
Educate Yourself: Start by learning the basics of land investing. Books, online courses, coaching programs and attending seminars can provide valuable insights into the field. While on The Money Exchange Podcast, we spoke to Brent Bowers, an investor and coach with a focus on buying and selling vacant land. He shared how he has been able to help a number of people start investing in land through his program The Land Sharks.
Listen to this episode here!
Market Research: Understand the local real estate market and zoning regulations. This knowledge will help you identify areas with growth potential and suitable land for investment. Take a look at your specific state regulations and really do your research! If your looking to purchase land in another country, make sure to check their regulations as well!
Financial Preparation: Just like any other investment, land investing requires capital. Evaluate your finances and determine how much you can comfortably allocate to land investments. Here you can put in your financial planning efforts of budgeting and savings to properly plan! Make sure that you are in a good financial spot to begin investing!
Due Diligence: When you find a piece of land that piques your interest, conduct thorough due diligence. This includes researching the property’s history, boundaries, zoning regulations, and potential land use.
Network: Building a network of real estate professionals, appraisers, and fellow investors can provide valuable guidance and opportunities. Use social media platforms (LinkedIn, Facebook, etc.) and website to find contacts. Attend events to network with others as well!
Strategy for land investing: how do I make money?
Buy and Hold: Purchase land with the expectation of long-term appreciation. This strategy requires patience but can yield significant returns over time.
Land Development: Invest in land that has the potential for development. This might involve subdividing the land and selling smaller parcels or working with builders to develop residential or commercial properties.
Land Flipping: Similar to house flipping, land flipping involves purchasing land at a low price, improving it, and selling it at a higher price in a relatively short period.
Leasing: Lease your land for various purposes, such as agriculture, recreational activities, or cell tower installations. This can provide a steady income stream.
Land investing is a dynamic and rewarding niche within the world of real estate. It offers the opportunity to build wealth, achieve financial freedom, and enjoy the simplicity of investing in the earth beneath our feet.
Whether you’re a seasoned investor or new to the world of real estate, land investing is a path worth exploring. With careful research, due diligence, and a strategic approach, you can unlock the potential of land and secure your financial future. So, take that first step, and embark on your journey to becoming a land investor by listening to Episode 129 of The Money Exchange Podcast where Brent Bowers dives into the art of land investing.