A traditional investment portfolio might include, bonds, stocks, currency, and other financial instruments, in modern investment portfolios we are now seeing land investment. Many people ask – “Why invest in raw land?”, well, the answer is simple, money.
For hundreds of years in the United States, and undoubtedly across the globe, people have made a fortune in land investment. Land can be extremely affordable, creating opportunity to make a vast return per the original investment cost. This return on investment (ROI) requires little to no effort at all. The essential factor dependent on the amount of your ROI is the path of growth.
When you invest in vacant land, it is best to research the surrounding areas, such as demographics, future developmental plans, population, local attractions and landmarks. Investing in land in an area that is growing and prospering will be your best bet in obtaining a larger ROI. You don’t have to be a seasoned investor to make a fruitful land investment, it’s a matter of research and keeping an eye out on the surrounding area. The value of land can slowly appreciate, similar to watching paint dry, or it can sky rocket instantaneously overnight.
I’m sure you have heard of a place called Disney World, what you probably didn’t know is that Disney World was built on swamp land. Yes, alligator infested swamp land right in Orlando. After years of much deliberation and considering different cities, Orlando beat out St. Louis, Missouri in the final round. The architects and planners of Disney World were attached to the developing area of the city, they saw great potential in Orlando. At that time, Orlando’s highway system was growing, Interstate 4 (I-4) was under construction. The interstate cuts across the state and Disney’s planners saw that it would connect the park to I-95. Florida’s turnpike was also an attractive aspect to Disney and the way it led right down to Miami. Disney was later asked what attracted him to Orlando and he answered “The way the roads crossed.” The rest was history, literally.
The day after Disney announced its plans to build in Orlando, the surround swamp lands exploded ridiculously in value. This included residential lots, to large tracts, Orlando saw an overwhelming increase in its real estate market. For the investors that had already owned swamp land in Orlando or those who quickly purchased once they sniffed that Disney was going to make the city their second home, made an enormous ROI on their properties. This can be credited to the path of growth.
Successful land investments are a combination of foresight and luck. Land is great for long term investments, you purchase a decent sized property “out of the way” far from everything, and just sit and wait. When a major corporation announces its plans to open a headquarters or a new branch in the vicinity of your property then you just hit the jackpot. As growth closes in, your property becomes “in the way” and when the property reaches an acceptable value, you sell.