Land is one of the highly prized assets, but buying raw land can also be a risky investment, especially without a solid development plan.
Just owning the right piece of land, purchased at the right price, outshines issues with settling for the right type of investment plan.
Common ways of land investments include residential and commercial development, agriculture and livestock production, mining and using it as a recreational centre.
Residential land development
This is whereby you can develop houses and commercial centres for sale or rental. You can be a landlord and accrue rent from the residents.
Lease and Hire
You can also lease your land to individuals, firms or the government for a certain period of time.
You need to find out first which type of cultivation is suitable and allowed in the area.
An investor can also grow vegetables in large scale farming.
Here, one can also exploit the construction of dams, poultry and fish ponds.
Also get experts to measure your soil before cultivation.
Use your land for dairy and livestock production.
New land buyers are always encouraged to fence their parcels and grow trees first. Trees can be sold for timber production and also enrich the soil for future cultivation.
Mineral production land
Land can be mined for soil, quarry and other minerals rich in the area.
Land can be developed for tourism i.e in serene areas that attract visitors. One can also construct an entertainment joint for recreational activities.
Potential investors in land should always be aware of the specific types of land-related investment options available through investment products such as exchange-traded funds (ETFs) and exchange-traded notes (ETNs).
In the case of small investors, real estate investment trust (REIT) ETFs are a solid, cost-effective choice as they do not require direct management, are broadly diversified, and can be purchased or sold on a real-time basis.
A number of ETFs and ETNs cover most land-based investment categories, including timber, minerals, and farming.