Investing in land is an easy and profitable investment. Low earners can safeguard their hard-earned saving by investing in land property.
Moreover, investing in land is nearly free of risk. Naturally, land is an appreciated property. If you can choose a right land, you can get a risk-free return.
Generally, investing in real estate needs relatively much money. But you can buy a piece of land with hard-earned small money.
Understanding investing in land
You may have heard the name of land developing companies. Land developing companies buy land for real estate business purpose. They have large capital.
On the contrary, you may have saved a mentionable money. If you haven’t saved money for investment, learn how to save money for stock or any other investments.
Now, you want to invest this saving so that you can get a return. Moreover, you may emphasize the safeguard of your hard-earned money.
In this paradoxical situation, I suggest you to invest in land. You may buy a piece of underdeveloped land.
Then, you can spend some money to develop this land property. After that, just wait for some years. Present value of land is definitely higher land previous value of land.
Thus, you can earn a mentionable return from selling your previously lower price land in appreciated value.
Before investing in land, you should ensure that land property is appreciated in your country. Otherwise, you should cautious to invest in land.
Almost all the countries in the earth, land property is not depreciated in nature. So, make sure that land value is appreciated property in your country.
How much money do I need to invest in land?
The answer of this question depends on placement of your targeted land. Generally, top cities’ land value is higher than underdeveloped cities’ land.
Similarly, rural areas’ land is cheaper than cities’ land. On the other hand, investing amount depends on the actual measurement of your targeted land.
If you have small capital, you should buy undervalued land near any city.
After some years later- when the city expands- your land property’s value will definitely high. So, you should invest for 10 to 15 years.
How to invest in land development
Land development investment means spending some money on your land to add more value. For example, you my buy a land which is used for fish cultivation.
That means this land is not suitable for house or apartment. You need to develop this land in order to build a house.
For this, you have to fill up this land with soil. Soil cost and fill up cost are the land development cost.
Why should I invest in land?
Investing in land is a smart investment because it has no risk but you can get a suitable return. Moreover, you can use land in multiple ways.
Let’s share a real example
Nearly 15 years ago, my father and uncle bought a piece of land at $4000 in rural area. Present value of this land is about $18000.
Return on investment (ROI)= 350% (18000-4000)/4000*100. And each year, at least 20% return came from crop producing.
15 years crop selling return is 250%. Do you know any other investment which gives 600% within 15 years?
Per year average return is 40% (600/15). You may say stock investment or some other investments which may give 100% return.
But remember that, invest in land is free of risk. Almost all businesses have loss and don’t guarantee a fixed return. But land property is different.
So, you can invest in land if you don’t like to take risk and want a steady return.
7 reasons you should invest in land
1. No Risk in Land Investment
Investing in land has no risk if you can buy land properly. You can save your money by investing in land which has no risk but has a smart return. Moreover, you need no investing skill.
2. Investing in Land for Steady Return
You will get steady return from land investing. But you have to wait some time. You may not get monthly return from land. You can invest in stock if you need early return.
But you should not invest in stock market unless you have basics and advance knowledge about stock market. Moreover, you have to learn how to pick stock for swing trading or how to apply day trading strategies.
For long term investment, learn how to buy stock for long term investment. Don’t you have no time to achieve investing skill? Just invest in land.
3. High Social Value
Your social value will increase if you have investment in land. People give extra value if they know that you have a piece land in downtown. So, try to invest in land early.
4. Multiple Uses
You can sell your land when it’s value will appreciate. Moreover, you can build house in this land. Then, you can use this house or can rent out to tenants. Thus, you can save your rental expense or can get monthly rent.
5. Investing in Land for Rental Income
You can rent out your land for cultivation or using. You have nothing to do for this. Just find out a farmer to use your land if you buy a land in rural area.
You may get 15% to 20% yearly return by renting out your cultivable land to a farmer. Moreover, you can build house and rent out your house to tenants.
6. Saving Rental Expense
You can build house in your land. By this way, you can save your monthly rent expense. Moreover, renting out your extra rooms or flats, you can earn rent revenue.
7. Loan Facility
You can easily borrow money from bank by using your land as guarantee. This borrow money can be used for building house or apartment. As land is a stable property, land is a perfect guarantor for taking bank loan.
Best places to invest in land
From my experience, I suggest you to buy a piece of land near city or near core city.
But you need good amount of money to buy a land in a city. So, you can buy in rural areas or some other places.
Moreover, if you have money, you can buy land near sea beach so that you can build resort by taking bank loan.
In a word, you must select a place that has future demand. Before buying decision, you have to ensure the below common factors to buy a perfect land.
1. Your targeted land near highway or has transport facilities.
2. This land has utilities facilities.
3. The land is situated near core city.
4. It has high demand in future.
5. It can be used in multiple ways.
Does investing in land is better than investing in stocks?
Stock investing or stock trading is not a suitable business for all. You need enough investing skill to succeed in stock trading.
Moreover, stock trading is a risky business. You can easily lose all of your trading capital within short time.
Although stock trading is highly profitable, you can lose all of your trading capital if you make trading mistakes.
To achieve financial freedom with low income, you can invest in stock market if you have enough knowledge about stock market.
Learn about how to start stock investing. If you have no ideas about stock investing, read 44 basics points about stock market.
Investing in land vs new business
You can start new business if you have good planning and sufficient time. But investing in land need no planning or time.
Just need to find out a perfect land. Any business is profitable. But business has risk. Low earners always fear about losing hard-earned money. So, they can invest in land without any fear.
Summary of Investing in Land
Investing in land is risk free and high return. But you should buy land in a suitable place. Land can be used in multiple ways.
If you want to learn about stock market investment and personal finance management from basic to advance, you should read All in One section.