Should I Invest In Real Estate?

By Dave Knospe

With so many investing options, you may be asking yourself…
“Why invest in real estate?”

1. Security
Real estate investment is about security.  The stock market can move with lightning speed: rising 100 points in a day, then falling another 200 overnight.  However, land prices tend to climb steadily over longer periods of time.  When you invest in land, you are investing in something real: a solid piece of American soil that you can see, touch and experience for yourself.

2. Diversification
One thing that investment professionals can agree on is the necessity of having a varied and diverse portfolio.  Land investment can help to achieve that diversity.  Jeff Opdyke of the Wall Street Journal stated,  “Investment pros routinely agree that a portfolio should have between 5% and 20% invested in real estate that isn’t a primary residence.”

3. Long Term Gains
Investing in the stock market can make for a quick profit … or a quick loss.  Land is a better investment for the long term.  As a rule, the price of real estate tends to double every 10 years.  Historically, it has proven accurate to say that a property worth $10,000 today will be worth $20,000 in 10 years.

4. Inflation
One of the reasons that real estate prices tend to rise so consistently is the effect of inflation.  Although inflation can harm many forms of investment, it is a boon to land investment.  “A physical asset such as land goes up in value when inflation soars,” said Jim Jubak from MSN Money.  Jeff Opdyke agreed, “From a financial-planning perspective, real estate is an asset that investors should have in their portfolios over the long term.  That is because real estate serves as a counterweight to inflation.”

5. Simplicity
The simplicity is another factor that draws people to invest in land instead of other forms of real estate.  For many Americans, the home they live in is their first major investment.  They put their money down, then they put on a new roof, add some landscaping to increase the curb appeal, watch for home prices to rise, and then, when it is time to move out, they repaint all of the rooms, clean everything and hope for a big return on their investment.  Those who invest in commercial or multi-unit residential property worry about repairs, inspections and tenants who do not pay.

6. Profit!
Invest in land for the security it represents, for the freedom of owning your own piece of America, and perhaps the best reason of all, for the profits you can make.  As Andrew Carnegie said, “Ninety percent of all millionaires became so through owning real estate.” Buying land has many similarities to investing in other types of real estate, but it is much easier.  There is no roof to repair or renters to worry about.  Land is an investment that grows without your having to lift a finger.  Values grow as the cities expand, new roads are built and new businesses are developed.

Article Cited:

“Why Investors should consider Real Estate” by Jeff Opdyke, Wall Street Journal Real Estate

“Land Ho! Now’s the Time to Buy” by Jim Jubak, MSN Money

Looking for vacant land?

LandCentral sells affordable and accessible vacant properties nationwide

View Available Properties