Do Not Overlook Buying Land When Investing In Real Estate

A lot of people think it is crazy and pointless to invest in land, since land just sits there and does absolutely nothing, people think it is pretty much pointless. The truth is vacant land is actually able to produce some serious cash flow. In fact, it is one of the best and easiest investments in the world since it is totally hands off.

I love the fact vacant land just sits there and does nothing. The simplicity and stability of owning a piece of land far outweighs that of owning a piece of real estate, it cuts out the myriad of problems that follow. If you have overlooked buying land in the past you may want to take a few minutes to educate yourself on what buying land is all about.

Here Are 10 Reasons Why People Are Investing In Land…

1) Buying land means you do not need to “do” anything to the property.

Construction? Renovations? Forget it! The fantastic thing is with buying land, you do not need to employ experts to re-build, re-decorate or anything for that matter, all you need is you! The most you will need is a survey to see if you are actually able to construct a house upon the land, that’s about it, once you know this, a huge part of the battle is already won.

2) It’s hands-off investment

Had enough of dealing with tenants, mold, repairs, gardening, leaks and hundreds of other issues that come with real estate? Well vacant land has none of these issues, once you purchase the land, it just sits there and will always sit there, nothing happens.

3) Land owners cannot wait to sell

Why? Because those that own land do not live on it, nor do they live near it. When this happens there is less of an emotional connection to it, in many cases you will find the owners of land cannot wait to sell and will do so for pennies on the dollar - just because they live nowhere near it and it is not producing a dime for them. It will not produce a dime for them because they have little to no knowledge on how to optimize the land correctly. Find these people and you will find a goldmine.

4) Land has zero competition

Real estate can have some serious, stiff competition. It also bring huge stresses, being outbid on properties you really wanted, people butting in on deals you are trying to do. Well guess what? There is virtually no competition with land purchasing. A lot of real estate investors have their minds glued to apartments, studio’s, condo’s, houses and more. Many of these investors do not understand what role land could play in the investment world, you could use this to your very advantage.

5. There is not much start-up cost required

When real estate investors first start out, they tend to borrow money off lenders and banks for the first initial investment. This means for the first sale or two they are in a debt that they must pay back, after the third or fourth sale they finally come into profit. With land investment there is no need for a huge initial start-up, in fact, you can start out with just $5,000 or even less!

6. You don’t even need to see it with your own eyes

There are those out there that buy and sell land that never actually go to see it in person, these are what I like to call virtual or office buyers. It is possible to use free software online that anyone can access, purchase a plot of land and then re-sell it after the inspection process. The entire thing can be done virtually, though I would only recommend doing this in the country you are from, unless you are willing to check the laws of that particular country you are buying in as some can be quite tricky.

For Example, I am from the UK. If I want to find land for sale in Canada, there are no restrictions for foreign ownership providing I place a higher down payment on the land

7. You can use seller financing to sky rocket earnings

This is what we call “Easy money”. Combining vacant land with seller financing is an absolute goldmine, you are able to up the price of your land sale by quite a bit, just don’t be greedy. This means you can sell your land to the buyer for at least 40% more than what it should be and this will bring you long term profits. Most people that do this are those that simply cannot get a loan from the bank since banks do not really like to give loans for land as there is not much to repossess and there is “nothing” there.

On the other hand, if your buyer decides to use seller financing with you, builds a house and then defaults on the repayments, you can repossess the house and also the land it is built on.

8. Park your cash long term

When you buy land for the right price and do not over pay, your money would just be sat there with no mortgage repayments to make, no utility bills and the taxes are astronomically low. So if you are looking to park your cash somewhere in a long-term investment, land maybe the right option for you.