Is Land a Good Investment Right Now?
What is Land Banking
Land banking is the real estate strategy of buying raw, undeveloped land in the path of growth. The investment is typically held for 5-10 years with the notion of beating alternative investments. Like most things, the return on land investment is based on your knowledge of the market. Fortunately, we have land investment professionals who can give you an honest, studied and experienced opinion on land banking.
The Pros of Buying Land
Buying vacant land often gets ignored by new real estate investors because it lacks the sizzle of a fixer home or rental property investment. For seasoned investors, land remains one of the most intriguing and proven investment plays in the current market, here’s why:
1. Diversification – land can appreciate despite economic downturns
2. Uncertain market conditions
3. Hedge against inflation
4. Tax benefits for Opportunity Zones
5. Low barrier to entry
6. Land is a limited resource
7. Land banking is a passive investment
Land Banking in Today’s Market
High inflation, skittish markets, rising interest rates and overall economic and political uncertainty create the perfect environment for diversification. The most proven investment diversification strategy is land investment. According to recent₁ prominent₂ economic₃, artciles₄, high inflation is expected to last through the year and possibly well into 2024. The Fed’s goal of meeting 2% inflation will come with economic pains and risks of recession, more banking failures, and a bear market. Buying more will always net you a greater return but fortunately, private money, reinvesting and collaborating are all encouraged when it comes to land banking. We have a few great land opportunities listed here on our website.
Still unsure if land is the right investment for you? Talk to one of our land banking real estate professionals in the San Diego backcountry to get a consultation on your existing or potential real estate investment portfolio.