I am always hearing people say "I would never buy raw land."  It's like they don't know that it is land that appreciates. They think that only improvrd property appreciates. But actually it is the land componet of improved property that appreciates, not the structure. The structure actually DEPRECIATES.

Land is a good investment. The costs of upkeep are low. The taxes are low. But the RATE of appreciation is greater than for the improved property next door.

The difference in home values from one area to another is primarily the difference in land values. The cost of construction can vary but not significantly. Costs of entitlements can vary, but they don't represent the major componet of the cost of a new home. So what is the major difference from one area to the next.

It's the land!

A good investment strategy for the aspiring wealth builder is to buy land in the path of progress, hold it until its area is over-taken by growth, then either sell for a massive profit or develop it for an even greater profit.

And if you can't stand the holding costs while you're waiting then find a farmer to lease it to.

I like to buy land. I prefer to buy land. Give me land, lotsa land!

 

7 Comments on I would never buy raw land

I had a client in my office this morning.  He claims to have a friend that bought 300 acres of land in Las Vegas back in like 1950 or something for $7500.  It was way away from the casinos and complete undeveloped desert.  His friends called him crazy.  He claims he just heard from the guy and he turned down $150 million.  He thinks it will be worth much more down the road.  If it were me, it'd be SOLD!  Nobody lives forever...lol

07/03/2007 09:54 AM by Tony D. Howell (Olympic Mortgage Consultants, Inc.)


Tony, tanks.

I would like to meet this guy. He's my kind of investor. He shows that he guts and vision.

Bill Roberts

07/03/2007 10:06 AM by Bill Roberts - "Baby Boomer" Retirement Planning (Brooks and Dunphy Real Estate)


Is that friend the guy who was in the news not that long ago who was farming the land or something and still turned down the money from the casinos? 

 

I always wondered why raw land got such a bad rap, when you can more than cover your costs by leasing the land to a farmer if it was so suited?

 

Bob Mitchell

ValueList Real Estate Services, Inc. 

07/03/2007 10:17 AM by ValueList Real Estate Services, Inc.


I don't know about buying land but I sure like to sell it. I don't have to worry about wallpaper, termites, staging or anything else that is in the way of selling homes. Either it meets the clients needs or it doesn't. Either they like it or they don't. Here in Georgia commissions on land usually run at 10% which is another good reason to work with folks that want to buy or sell land.

07/03/2007 10:34 AM by Michael Neubauer (Coldwell Banker Residential Brokerage)


Thanks giys. It seems that we will have plenty of land to buy or sell because all the other agents are more concerned about CraigsList than land. That's OK by me. Yeah! 10% and no wallpaper to worry about.

Bill Roberts

07/03/2007 10:58 AM by Bill Roberts - "Baby Boomer" Retirement Planning (Brooks and Dunphy Real Estate)


Bill~


Sure hope you will post this on over to the Land Specialists Group as well as the ECO-All-Stars. We are raw land-lovers =)

07/08/2007 06:27 PM by Asheville's GREEN Land & Homes ECO-Steward Realty


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Real Estate - Other: Bill Roberts -  "Baby Boomer" Retirement Planning (Brooks and Dunphy Real Estate)
Bill Roberts - "Baby Boomer" Retirement Planning
Oceanside, CA
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Brooks and Dunphy Real Estate

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