“The wise young man or wage earner of today invests his money in real estate.” -Andrew Carnegie
Investors looking for relatively secure opportunities should consider devoting some of their money to invest in vacant land. Vacant land investing can give you several ways to profit. Some people purchase land, wait for the value to increase, and sell the property at a higher price at a later date. Others who invest in vacant land generate revenue and seek enjoyment from the property while they wait for the property’s value to increase. There are also many different ways to invest in land.
No matter how you decide to invest in vacant land, you should consider the details before you spend money on any property. Developing a plan with the help of a qualified land professional will make it easier for you to generate higher profits.
The Value of Vacant Land Can Grow Quickly
“Don’t wait to buy land. Buy land and wait.” – Will Rogers.
People have been moving from urban to suburban areas for generations. As families accumulate more wealth or move into retirement, they often want to get away from crowded urban areas so they can enjoy the privacy of suburban and, even better, rural homes. As more people move to the cities, the boundaries of suburbs will continue to reach out further causing a demand for vacant land to build homes on in the future near the outskirts of large metropolitan areas. Even with the recent pandemic there has been an increase in the demand for rural residential land and hobby farms.
The COVID-19 pandemic may accelerate the trend away from urban lifestyles. Anyone living in New York City during the pandemic, for example, has seen the challenges of surviving in a crowded city. As resources become increasingly scarce and increasing numbers of contagious people make going out in public unsafe, more and more people are wanting to get out of urban centers.
Not everyone will want to live in rural areas exclusively. Those who can afford to purchase rural retreats are more likely to do so now that they’ve seen the difficulty of living in cities during a pandemic.
Developing Vacant Land Can Increase Its Value
“Landlords grow rich in their sleep without working…” -John Stuart Mill
Undeveloped, vacant land becomes an undeniable investment opportunity when you’re willing to spend time and money adding buildings, infrastructure, and other features. For example, you can increase the value of vacant land by installing the utilities that most people look for when buying homes. A piece of land that no one wants becomes much more desirable once you add electrical lines, water, and sewage.
Other features that may increase the value of vacant land include:
- Houses and cottages.
- Barns and sheds.
- Ponds and lakes.
- Meadows and trees that attract wildlife.
- Tree Stands.
Vacant Land Can Generate Revenue Before You Sell
“The best investment on earth is earth.” – Louis Glickman.
If vacant land already has some desirable features, you can use it to generate revenue while waiting for the property’s value to increase. You could earn money from land with fertile soil and a water source by renting or leasing your land to farmers. You can also make money from transitional land by:
- Selling timber.
- Charging a fee for hunters.
- Renting cabins and houses to vacationers.
- Selling mineral rights.
- Offering an Agritourism attraction.
Pay careful attention to a property’s features before you buy it. Without trees, water, and other desirable features, you probably can’t make much money from it while you wait for the value to increase.
Use a Qualified Land Agent When Investing in Vacant Land
“Buy land, they’re not making it anymore.” – Mark Twain.
It’s often challenging to determine which pieces of vacant land make suitable investments. Ideally, you want to get a return on your investment as quickly as possible, but with land you usually make more when you play the long-game. At the same time, you don’t want to sell too early and miss the opportunity to boost your profit.
You can make money from vacant land while you wait for the value to increase, but that depends on whether people find the property attractive. Without fertile soil, water, electricity, trails, and other features, you might not earn enough money to cover property taxes and additional costs. You can also enjoy the land while you own.
You can significantly improve your chances of success by working with an Accredited Land Consultant (ALC).
Don’t make the mistake of assuming any real estate agent can provide the same services as an ALC. ALCs don’t get their credentials until they have an exceptional level of experience in the land industry doing land transactions. They also need to complete a rigorous education program and pass exams to hold the designation.
Before you start investing vacant land, find a land consultant in your area who can help you focus on finding properties that match your needs. Your ALC may already know about a few properties that you can purchase within the next few weeks.