Scarlett O’Hara’s dad was famous for proving her with the pithy advice that “land is the only thing that matters.” That was enough inspiration for Scarlett to do whatever she had to do to protect her beloved Tara. Out here in the real world, raw land still holds a lot of value. The big question many land owners face is whether to build or not to build on that property. Here’s some land investment advice.
As with an already built home, location is key to picking a winning plot of land to invest in. Right now, there isn’t a lot of competition out there for plots of rural acreage. This means you can acquire some decent plots and hold onto them for future development. You might also be able to “flip” the land.
Just as you would flip a home, selling a plot of land for profit requires investment, commitment and luck. The big difference with flipping land is that you really don’t have to do anything to it but hold onto the acres. If another developer comes along and needs to buy up your land you could make a sweet profit. However, you might be holding onto that land for some time.
There are just so many places where builders can build these days. Commercial real estate aside, if you have a chance to buy some undeveloped property around a lake or in the outlining areas of a developing community then this could be a good invest to hold onto. The thing is not to get too greedy. The stories of landowners “holding out” for millions and getting those millions are few and far between. Developers don’t have a lot of time to waste and might be inclined to move on.
On the other hand, if you have a piece of property that is in a prime location, you might consider making the additional investment of building a home on that site. Designing a dream home for yourself is one thing but if you’re merely looking to create a space that you can sell for profit you need to consider whether or not this new home will have appeal several months down the line. That’s when it might be ready to come onto the market. Until then you’ll be making a serious cash investment. Of course, if you are building in an area that is seeing rapid expansion or has some element of a vacation destination to it (coastal, lake and/or mountain properties) then your investment could be warranted.
It could really come down to a matter of patience on your part. If you see a good piece of raw property in an up and coming area then buy it. There is no rush when it comes to developing that plot. Once you’ve got the deed, start snooping around. If a major development is on the horizon, then keep a hold of that land and bid your time.
You can also buy from a builder who already has the land. If you get on board early, you can have a say in customizing the house. Review active listings from custom home builders in Douglas County CO.