Turning Land Into Cash

Land investment is no longer the preserve of the super-wealthy and big developers. As a small investor, and with a little help, you can now turn land into cash.

What’s the attraction of land?

When you’re thinking of something to do with your money, land is rarely at the top of the list. That’s because most people assume that any land with development potential will be too expensive for them, and so they turn to more affordable investments such as savings accounts, FTSE 100 company shares and tracker funds. Take another look at the potential of land though, because it could make you more money than all your other investments combined.

Why are the potential profits so great?

As a private investor, you will be buying a parcel of land within a larger plot; this is what makes it affordable. The land company buys a large area of land that it has researched and which it thinks has a high likelihood of being ear-marked for housing development in the future. The land is reasonably cheap because it doesn’t have planning permission attached to it, and so the investment company divides it into smaller plots so that private investors can buy affordable land. If the company is right, and the land is later granted planning permission, the value of the land increases substantially – sometimes by as much as 800% - and significant profits can be made. The UK’s demand for housing is increasing every year and there is a constant need for new development, so more land is needed to fulfil the housing need.

Are there risks?

Land is the same as any other investment; profits cannot be guaranteed. There is a risk that planning permission will not be granted for the site where you hold land. That’s why you should always speak to a reliable land agent and make sure that you are happy with the investment company’s reasons for thinking that the land has development potential. No land agent should promise profits, but if you invest wisely, you could see an amazing return on your investment.

Author: Strategic Land Investments

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