Investing in land can be a profitable and promising direction for those who want to diversify their portfolio and earn a stable income.
Read more - Stability: Land tends to retain its value and can even increase in value over time, especially in the context of population growth and urbanization.
- Low operating costs: Unlike real estate, land does not require significant maintenance and management costs.
- Flexibility of use: Land can be used for a variety of purposes - from agriculture to the construction of residential and commercial properties.
- Tax incentives: In some countries, investors can receive tax incentives on land, which makes investments more profitable.
- Location: The success of investing in land largely depends on its location. Land in remote or less developed areas may not yield the expected profit.
- Regulatory restrictions: Local laws and regulations regarding land use, zoning, and construction must be taken into account.
- Market unpredictability: Land prices may fluctuate depending on the economic situation, supply, and demand.
A competent investor first develops a strategy and then looks for a way to implement it, or does the opposite: first gains a competitive advantage (finds an asset cheaper than others), and then builds an investment strategy for it. In any case, a business plan is taken as a basis, the profitability of which should be at least 30% per annum. If your strategy implies income less than the interest on a bank deposit (8-10% per annum), then it is better to abandon such a business plan.
Step 1 - Get rid of uncertainty You are ambitious, full of energy and have already earned your start-up capital, but the money supply is melting under the rays of inflation, and everyone around you says that money should work. This situation is oppressive and a feeling of uncertainty arises, a desire to discard everything that seems difficult. It seems that investing in real estate requires a bag of money, that "this topic is not for me", that everything has long been grasped and it is better not to even twitch. Therefore, the first thing you should start investing in land is to get rid of uncertainty.
Step 2 - Get rid of other people's advice Getting advice from a relative or friend is a great idea, people should use their social capital and life baggage of each other. Sharing experiences is useful. However, most novice investors make a classic mistake - they consult with those who do not understand anything about investments. With the same effect, people themselves give each other stupid advice. When you come to a friend for advice on how to invest money in land, you will receive a set of vague hypotheses that will only clog your brain. A friend or neighbor is unable to give useful information because he or she does not have it. Theories, hypotheses and rumors are all that they can help you with.
At the initial stage, adhere to the following rules of effective information exchange:
Friends and relatives are wonderful people, but they are not a jury and should not evaluate your every step. Ask them for advice when you are confident in their competence;
Energy and informational connection with people is necessary. Especially if you are joining a new environment. Build and maintain relationships only with professionals or ambitious like-minded people. Avoid losers and whiners.
Step 3
- Study the territorial development plan A profitable investment in land should start with monitoring the regional development plan. The data is publicly available - on the municipal website of the region. Knowing the regional development plan allows you to: Make an objective forecast of the region's development for the next 5-10 years; Understand the direction of expansion of the city limits; Buy land before the start of infrastructure construction.
1. Market research
It is important to conduct thorough market research before purchasing a plot of land. Research local trends, demand for land, and infrastructure development plans. This will help you choose a plot with high growth potential.
2. Investing in agricultural land
Agricultural land can provide a stable rental income. Investing in such land can also be profitable in the long term, especially if you plan to use it for agribusiness.
3. Land development
If you have experience in construction or development, you may want to consider buying a plot of land for subsequent development. This can be either residential or commercial.
4. Investing in development land
Buying land that already has planning permission may be a less risky strategy. Such land often has higher liquidity and can quickly generate profit.
5. Participation in joint investment projects
If you do not have enough capital to purchase land on your own, consider participating in joint investment projects. This will allow you to reduce risks and gain access to larger projects.
6. Long-term ownership
Investing in land for the purpose of long-term ownership can be profitable, especially in areas with a growing population. Over time, the value of the land can increase significantly, which will bring you profit when you sell it.
Investing in land is a combination of knowledge, work and luck, the ability to think strategically and make plans for at least the next 5 years. People with an entrepreneurial streak find it easier to assess risks, but "humanitarians" also have every chance of making a profit. Updated legislation and available information allow anyone to independently master land investments.
