A parcel of land is one of the most profitable real estate investments. Buying land is such a lucrative investment that foreign investors have swept into the U.S. market to secure large tracts of land. According to data, in 2020, foreign land ownership in the U.S. stood at 37.6 million acres or about 2.9% of the U.S.'s total ranch, farm, and forest land.
So, what's driving these investors to purchase property, and what are the top reasons you should also consider purchasing land as your long-term investment? Here are reasons why purchasing land should be the next item on your investment bucket list.
It's the Best Way to Grow Your Wealth
The best way to grow your wealth in a fluctuating economy is by investing in more than a fat savings account. Unlike bank savings slowly accruing interest, land appreciates and increases value faster. Moreover, it is the best option for growing generational wealth you'll pass down to your kin.
Perhaps the most significant advantage of investing in land to grow your wealth is the flexibility of options you get based on your budget and needs. You can get various land investment opportunities that offer flexible payment options at your preferred location.
Therefore, you can build a sizable land investment portfolio based on your finances and needs.
You Get Diverse Options on How to Use the Land
Owning land gives you diverse options on how to use it. These options align with your needs as an investor, such as creating positive environmental impact and geographic restoration.
If you're not angling for a complete geographic restoration, you can use your land for commercial purposes by investing in residential buildings or farming and livestock.
Residential and Commercial Building
Residential and commercial buildings allow you to develop or lease your land to a property investor based on your financial goals and expectations. If you're financially capable, you can construct a commercial building on your land to make it more valuable and create income.
If you're incapable of developing it, you can lease it to a commercial or residential building investor who will use it for several years.
Building sustainable residential and commercial buildings is still possible to ensure your investment has a minimal environmental impact.
Farming and Livestock
The majority of landowners who buy properties in rural or suburban areas have the option of renting those properties out for farming purposes for several years. Leasing your land for farming and rearing livestock generates revenue from your land and leads to capital appreciation.
Land Investments Steadily Appreciate
Buying a parcel of land is one of the most stable investments you can make. Historically, land has been known to appreciate in value since you'll hardly lack any use for it. You should only perform a little due diligence about the area you wish to buy land and the surrounding properties to discover its best use.
That way, you'll be able to generate steady future income.
For instance, think about finding a piece of land in an up-and-coming area with several residential and commercial developments nearby. Land near such an area would be great, especially if you want it to appreciate over time.
Before purchasing, it's always worth checking out the types of businesses that operate in the area and the typical asking prices. In addition to buying the right piece of land at the right time, one should seek out raw land with unlimited access to natural resources such as greenery, air, and sunlight.
It Doesn't Need Maintenance
Unless you have buildings on your land, you won't have to maintain it. However, if you buy land with buildings, you will have to factor in the cost of repairs and maintenance, no matter how new they might look.
Structures also increase the risk of theft and vandalism. Therefore, you'll also have to invest in security if your property has any buildings.
However, the situation is different when you've invested in raw land. Since there's no structure on it, there's no need for regular maintenance or investment in security. Therefore, you get a hands-off investment that won't need much of your time, money, or effort.
A Parcel of Land is a Great Source of Passive Income
Passive income is money you earn in the background of other revenue streams. That is different from active income, which comes from an active undertaking such as a full-time job where you're being actively paid to show up daily.
Therefore, passive income requires little or one-time effort. A good example is bloggers or YouTubers who still earn from content they created years ago, even while sleeping and doing something else to generate active income.
Investing in land is a good way of earning such passive income. The traditional way is to buy land and let it appreciate over time to generate money without any effort on your part. With this method, you keep the parcel of land and then sell it later at a higher price as a source of passive income.
Alternatively, you could lease your vacant land to someone else to make money from it. This could be a property investor or environmental impact organization interested in transforming your raw, vacant land into something more valuable.
Make a Land Investment with an Impact
You may not be able to see the returns on your investments right away, but the benefits of a land investment are long-term and can impact you and the world around you. They are often much more profitable than any other type of investment and offer a sense of security.
If you're passionate about the environment, you can consider making a land investment for a cause. Contact Fynn Partners to purchase or sell land to a trusted organization Sell one, plant one. For every land you sell to this organization, they will plant a tree or make a purchase of carbon credits on your behalf to fund a forest project from a global portfolio.
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