Your due diligence will be key before proceeding with a land purchase.
When you clear all of the paperwork, you'll find many long-term benefits of buying land.
Here are some of the advantages of purchasing land in 2021.
You Can Let the Property Stay the Same
If you're thinking about buying land in 2021, you may want to hold onto the property. The great thing about buying property is you don't need to do anything about it immediately. You can hold onto it for a greater purpose.
If you're not trying to build a property on it, the land is still valuable. Maybe you want to keep it there as a safety precaution if you have to make a move. Even if there was a property on there like an old building that was a hotel, it's not a bad idea to renovate it.
You might be able to get a sale for the hotel and the land that surrounds it. It could be a lucrative ROI for you.
It's Easier to Buy If It's Vacant
Buying vacant land is a lot easier. When there are no structures on it, it's easier to convince the owner to sell it. In fact, they may want to sell it for practically nothing.
The owner could have bought the property years ago but never knew what to do with it. Maybe they didn't have the time, or it's just something they held onto because they thought they would eventually figure things out.
A vacant property usually has no emotional ties to it. There isn't a commercial building making the owner money or no home for a family. They may be looking for someone else to buy it from them, so they don't have the burden of holding that land.
If you're buying a vacant property, then it's easier for you to purchase it immediately. Also, you don't have as much competition because there's nothing there but land. It's a good chance for you to carry out a long-term idea you've had and not spend an arm and a leg on the project.
Always look around for an ideal area to purchase vacant property to help you lock into your goals and dreams. There will be some key things to research before buying land though. You can make mistakes buying land as easily as when purchasing a house.
Helps You Avoid Banks and Mortgage Companies
If you've saved enough money and know the right sellers, you might be able to avoid banks and mortgage companies. With banks and mortgage companies, there's a lot of paperwork, waiting, and negotiation that takes up too much time. You may be ready to pull the trigger on a piece of property right away before everyone else starts to know a potential goldmine is out there.
You can deal with the owner directly, and you may have the right amount of money to get upfront. A bank or mortgage company will give you the runaround, and you may miss out on a great opportunity.
Land loans are harder to come by than traditional home mortgages. Not to mention, you might have to pay extra fees for their services.
Also, they may entice you to borrow from the bank, which puts a deeper hole in your pocket for the long term. When you get there early before the demand increases on the property, it gives you more leverage. Also, you don't have multiple hands in the pot trying to get a piece of your pie.
Great for a Long-Term Investment
The best thing about owning vacant land is that it doesn't come with all of the headaches of owning a building on it. Since land doesn't have much on it, you're not paying sizable property taxes on it. All you do is pay for the land.
If you're sitting on it for a while, you're not paying the mortgage, utilities, property insurance (very minimal if you do), or maintenance fees on the home.
You still have the flexibility to decide what you want to do with the property. If you're trying to build something on it for your business or you eventually want to sell the bare property once the market goes up, it's your choice.
It's a wise investment to help you make some serious cash if you're holding onto it for the long haul. Maybe that piece of land will be part of a condo complex or even an airport. If your piece of land is an essential part of the project, you have a better opportunity to negotiate a higher price for selling the land.
Think about the property potential before you decide to buy it and how it can help you with your future investments.
Can Improve the Property to Increase Value
Having a vacant property has untapped potential. You can do things to make the property better. If you notice the vast wildlife, you can put up fences and other things to deter pests from roaming all over your property.
Maybe you can create a garden out of the fertile grass you have on your property. Also, building a place where you can cut timber or other natural items can help make it a valuable home. If you have potential buyers lined up to purchase your property, these improvements will make things more valuable.
Also, some businesses may want to get a piece of your property because it has the resources to provide them with raw materials. Maybe there's an oil source on the far reaches of your property, and an industrial brand near you wants to get on that. You can charge them and have more say so because that's a piece of your home.
If the company wants exclusive rights to that oil source, you can charge them a premium rate. Once you know the value of your property, it can be lucrative for you as a long-term investment. Working with a Realtor can be helpful to identify which pieces of property will work best.
Good Place to Retire
You might be holding onto the property for later. You have a high-paced career still in motion, and you're busy with building your brand. You don't have time to live at this place.
After you've gone far in your career to help create a stable life for yourself and your family, you'll have a place to retire on. You might want to create a dream farm that leaves you with a peaceful environment after your corporate career.
With acres of land, you can make this come true. You can do it on your own time, and leave this for your family.
Maybe this is something you want your elders to live at in their last 10-15 years of living. They may have lived in a rural area, which will help them enjoy some great years with their grandkids. It's imperative to choose a place where you can live for decades.
Also, it could be a good investment for your kids who may want to live there after you're gone. The possibilities are endless when creating your ideal spot to pass down to your loved ones.
More Control Over Tenants
You may have the vacant land and turn it into a sizable condo or apartment complex. While it's great to own the building, it's even better to own the land. You may have an idea of using the space to build a residential property that you can rent out to others.
When you own the building and have the rights to the property, you have more dominion over how you run things. Find out the city's zoning codes before you get things together. Also, see how many tenants you can have in your building to help you maximize your profits.
Down the line, you can decide whether to subdivide the land or expand upon the original design to help meet your business needs. When owning everything outright, you have more flexibility from designing property, the people you rent your property to, and who will help you manage the building.
As a result, you'll have a more successful investment property.
Profit Off of Scarcity
Buying land is a finite resource. People don't usually buy land then sell it immediately. When you have this rare occurrence where you can buy a sizable plot of land for a below-market price, it makes it high in demand.
When you have the opportunity to purchase it before everyone finds out about the property, it gives you an advantage. Once you own the property, you can take your time to find a buyer who will pay you much more than your original investment. The more people want to move to that area, the higher chance someone will be on the lookout for your property.
Even if you're rarely on the property, you can always create an online sale. A vacant property doesn't require much maintenance, which saves you money. Think of it like a nest egg that's waiting to hatch once you find the best opportunity to sell it.
Investing in real estate such as land is always worthwhile because they are not making any more of it.
Creating a Commercial Business
Check to see if there are any shops close to your property. You may be able to create a brick-and-mortar building near a busy highway. Use the land to create something you're passionate about, and you won't have much competition to develop.
Maybe you want to create a convenience store or a tech brand from the ground up. It's an excellent way to use the purchased property for professional reasons. Also, you have a better chance to do well depending on the demographic of the people in your area.
It's beneficial to buy land in 2021 for many reasons. Figure out your best play so that you have a great chance to capitalize off of the opportunity.
About the author: The above article on the benefits of buying land was written by Ray Lion. Ray became a Realtor with an aspiration of being a sales leader in the market. With him, he took all of his experience in sales, negotiating, marketing, design, and educational background to excel in his new career. He enjoys providing helpful real estate guidance to buyers and sellers.