I think the author makes a good point in the last paragraph ... buying land is not as easy as hitting the "buy" key on your eTrade account. There is legwork and research required, and all of the data might not be at your fingertips online. He is also pretty clear about buying it without leverage, so he's not recommending this as a strategy if you are going to need rental income to cover a mortgage payment.
That being said, purchasing rural land has the opportunity to produce ongoing income from agriculture, timber, and hunting leases. Land purchased in the correct area has the potential to increase substantially in value if future development occurs. Our population is 300 million today and is estimated to be nearly 500 million in 2050. There are properties today that are rural that in 2020 or 2030 are going to be suburban or even urban in nature. Or, how about rural lakefront property? Maybe a particular lake isn't considered a vacation or retirement spot today. What about in 20 or 30 years? Another great place to look is property that borders state and national forests.
The daytraders of the land business ... aka "flippers" ... aren't around anymore. They were among the first to self-destruct in 2006 and 2007 when the music stopped and they couldn't find a seat. Buying land as an investment is a long-term strategy. The ideal investment property is a parcel that you can get enjoyment from while you own it ... by hunting on it, by riding horses or dirt bikes on it, by building a 2nd home on it, by farming it ... whatever trips your trigger. It is a great family investment, to enjoy together while your children are still young, to bring your children and their children together later in life, and as a valuable legacy to leave behind. Any financial benefits that you and your progeny may gain down the road is truly the icing on the cake.
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I think the author makes a good point in the last paragraph ... buying land is not as easy as hitting the "buy" key on your eTrade account. There is legwork and research required, and all of the data might not be at your fingertips online. He is also pretty clear about buying it without leverage, so he's not recommending this as a strategy if you are going to need rental income to cover a mortgage payment.
Oct 23 04:53 PM
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All Comments by AJezouit »Rural Land: The Ultimate Hedge? [View article]
That being said, purchasing rural land has the opportunity to produce ongoing income from agriculture, timber, and hunting leases. Land purchased in the correct area has the potential to increase substantially in value if future development occurs. Our population is 300 million today and is estimated to be nearly 500 million in 2050. There are properties today that are rural that in 2020 or 2030 are going to be suburban or even urban in nature. Or, how about rural lakefront property? Maybe a particular lake isn't considered a vacation or retirement spot today. What about in 20 or 30 years? Another great place to look is property that borders state and national forests.
The daytraders of the land business ... aka "flippers" ... aren't around anymore. They were among the first to self-destruct in 2006 and 2007 when the music stopped and they couldn't find a seat. Buying land as an investment is a long-term strategy. The ideal investment property is a parcel that you can get enjoyment from while you own it ... by hunting on it, by riding horses or dirt bikes on it, by building a 2nd home on it, by farming it ... whatever trips your trigger. It is a great family investment, to enjoy together while your children are still young, to bring your children and their children together later in life, and as a valuable legacy to leave behind. Any financial benefits that you and your progeny may gain down the road is truly the icing on the cake.