It's OK to comment on this post pro or con.

At one time I would have so agreed with you.  In this most recent downturn in the market though...

Also - 500% increase in land value in 10 years?

Matthew, the principle is very basic: land appreciates. The factors at work are the declining value of the dollar and the increased demand for the land due to expansion in the area. I am in Southern California and we expect tremendous population growth over the next ten years. If the value increases 125% over the ten year period due to inflation, then it only has to grow by a factor of 2.22 times in order to attain the 500%.

Personally, I think this is VERY conservative as long as the initial selection was done properly.

Our land values have held strong during current situation. Maybe some large tracts held by home builders took a hit, but not commercial. If anything they are stronger as the money moves in that direction.

Bill Roberts 

Excellent post Bill!  Numbers always win the argument.  It's sometimes hard to convince buyers that land is a good long term investment when they can't "see" their annual return.  Breaking it out like this is gives a good visual (provided you can back up your calculations and data of course). 

Not sure we'll be growing palms much here in North Georgia, but there are other income opportunities (logging rights, hunting leases, etc.).  As for the current downturn?  It's like the stock market . . . those in it for the long haul win out over speculators and flippers.  Land is finite, population is growing.  The math is simple.  Here locally we've suffered the same hit in residential sales as other parts of the country, but land sales haven't been affected as much and prices have continued to climb!

I particularly like your "path of progress" point.  When looking for investment land, the trick seems to be not just finding the cheapest possible tract (there's often a reason it's cheap), but one that will most benefit from the double bump of appreciation and growth.

Very good post, Bill.   We have always believed this and we are better off financially because of it.  Real Estate is a good investment but it is not liquid and can take a while to cash in.  So I think "don't put all your eggs in one basket."    

Trent, Thank you for your insightful critique. If you have land listings in Pickens County you can post them to my group All Land

Hope to see more of you.

Bill Roberts

Ricki, Real estate is the only basket I'm comfortable putting my eggs in. If real estate goes "bust" then the country will be gone anyway.

Thank you for your kind words.

Bill Roberts

Bill

Powerful stuff.....sorry I've missed so much content lately. I read one of your posts lately that referred to this group that you head up.

I'm a huge fan of owning land....while I sold 10 acres in the last couple of years, I intend to buy some more as the rate of appreciation is actually better in my experience than residential.

Bill, Yes, I've done a post comparing a vacant lot with a house next door. The lot faired much better than the house. Thanks for commenting here.

Bill Roberts

Chris, one of my investment strategies is to buy the well positioned commercial land and then develop it yourself. Here where standing commercial properties are valued at 4% ROI or even lower ROIs, building can give you an automatic equity of up tp 50% from the get go.

Thanks for commenting. I hope to see more of you.

Bill Roberts