When it comes to real estate investment, land is often times the overlooked step-child. There is amazing potential when investing in land that many investors never tap into! Learn more about land investment and strategy in our latest post!
There are many reasons to get into land investment. It can be an excellent way to begin investing or as a way to diversify an already robust portfolio. People from all parts of the country and in all income brackets are turning to land as a stable and limited resource. Is it right for you? Learn more below!
Guide to Land Investment in Ohio
Land is Low Maintenance
Owning a piece of land requires minimal maintenance, perhaps some occasional landscaping to prevent weed overgrowth. However, the land mostly remains untouched. It is crucial to stay informed about potential utility installations or costly assessments that may be imposed while you possess the land. Imagine purchasing a $5,000 lot only to discover later that you will need to pay $20,000 (over time) for water connection.
Easy to Get Started
Getting started in land investing doesn’t always require extensive experience. By conducting thorough research, you can uncover opportunities for as little as a few thousand dollars in Cincinnati. Familiarize yourself with the market dynamics to understand current land prices. Analyze seasonal trends, project future population growth, and investigate any upcoming development plans or zoning changes. Determine whether the land is ready for immediate development or if it is raw with no imminent plans in the vicinity.
Why Is the Land Up for Sale?
Not all land is the same. Plots of land in one neighborhood might be impacted by completely different environmental factors. Protected animals might live on your lot and not your neighbors. This can inhibit your ability to build, thus lowering the value of the land. Maybe there are oil tanks in the ground or frequent flooding problems from the creek nearby. Make sure you learn as much as possible about the lot before making a purchase!
What’s Your Strategy?
Flip It – To flip land effectively, you need to buy low and sell high. You can do this by finding unlisted deals or directly contacting the owners of lots that appear to be overgrown and forgotten. The land may have been purchased long ago, and all but forgotten about until it’s time to pay property taxes. By reaching out to owners directly, you will be able to create a relationship and possibly take unwanted real estate off their hands. When contacting any property owner, always be respectful and respect their privacy. If they are not interested in selling, never harass or bother them in hopes of doing so. You should then market the property to retail buyers. People who want to build a home on the site for themselves, etc.
Buy And Hold – Land is an excellent investment to buy and hold. It will typically appreciate over time and is very simple to maintain. Your primary expense will be property taxes which are significantly lower than taxes on a home. You can hold until land values see a considerable jump or development plans are put into place.
Lease It – Another option when owning land is to lease it to a party that has a use for it. This translates into almost 100% for you. Some interested parties might be farmers, hunters or a nearby business looking for parking. Obviously, you will need to make sure the lot is zoned for what your renter intends to use it for.