Smart Investing: How to Turn Undeveloped Land Into a Good Investment

Facebooktwitterpinterestlinkedinyoutubeinstagram

One of the most common kinds of investments a person can make is an investment into real estate. It’s true that a lot of money can be made from buying land. However, actually producing a return on your investment for a piece of land still involves some significant difficulty. Sometimes you have to do a lot of work to develop the land purchased so it does actually transform into a good long term investment. Below are a few strategies for doing just that.

Residential Development

One of the most common strategies for transforming undeveloped land into a sizable profit is to turn the land into residential real estate. These days, many people are moving out of the cities to newly constructed homes in the suburbs or even to previously rural areas. If you own land near where urban flight is happening, you could conceivably come out with a significant windfall.

Commercial Development

A second common option is developing land for commercial purposes. This could mean the construction of retail stores and other establishments that engage consumers. It could also mean using the land for industrial facilities like factories or distribution centers. Using the land for these purposes of course requires obtaining the right zoning from the local government. If the land in question is not zoned for those kinds of commercial purposes, some significant legal work will be required to obtain permission to commercially develop that real estate.

Farming

Third, the land purchased could be developed into farm land. Whether or not this is feasible typically depends on the climate and the soil in question. While you may own enough land to start a farm, you may not have the weather or mineral rich soil to yield a crop of any kind you could make a profit off of. Even livestock may have trouble if the land isn’t appropriate for grazing. Do you research before buying land for farming, and choose an area that will work best for your needs.

Timberland

A fourth viable option is investing into a forest or woodland that can be developed into timberland. This would of course involve allowing trees to be removed from those woods so they can be used to create wood-based products. Thankfully, managing a timberland can be done in a sustainable way so what is removed is replaced with new tree growth. This strategy can provide you with income for decades into the future.

Land will not develop itself. In a lot of cases, you have to put a lot or work and even hard labor into developing a piece of real estate. However, with the proper amount of work, it is certainly possible to make a large profit off of your investment. Consider your options for developing real estate you have your eye on.


Anita Ginsberg is a freelance writer from Denver, CO. She studied at Colorado State University, and now writes articles about health, business, family and finance. A mother of two, she enjoys traveling with her family whenever she isn’t writing. You can follow her on Twitter @anitaginsburg


All content on this site is the property of Taxbot, LLC, The Profit Junkie Podcast, or the author. You may link to any article that you wish, or share via the social media buttons below. However, please do not copy articles or images for use on other sites without express written permission.


Facebooktwitterpinterestlinkedinmail
%d bloggers like this: