Interesting Investment Opportunities in Landownership

Land is one of the most important factors of production. In this light, most of us have invested in land or thought of doing so at some point. However, most individuals invest in land because it is considered safe—that is, land appreciates with time. Nonetheless, there are interesting ways one can approach land ownership and end up making a profit. This article addresses such opportunities and gives pointers to would-be landowners.

Home construction — Over long periods, rent can accumulate to substantial amounts. This is usually the case for people who live in high-end neighborhoods around large cities. Instead of paying rent, one can opt to buy land and build a home. This option is cheaper over the long haul for houses in the same budget category.

Open space business — When building a house is prohibitive due to initial capital requirements, putting up a business can be a good alternative. Doing this would enable a landowner to fetch an income as opposed to keeping custody of an idle piece of land. Businesses that can utilize open land include used car yards, car washes and skates.

Subdivision and sale — Individuals who own large tracts of land can make a profit by sub-dividing it and selling it off in portions. The business opportunity lies in the fact that most people wish to own a piece of land, but few can afford to buy big. Also, a landowner enjoys economies of scale when buying big and translates the same into profits when selling.

Real estate — Construction of houses for sale is another investment opportunity that landowners can explore. However, this is one of the most expensive options in terms of capital requirement. An interesting angle to this is the buying and selling of houses. One can buy a house and keep it briefly while looking for a buyer. In such a case, one can be considered a temporary landowner through a house ownership certificate.

Leasing — Landowners can decide to make money through leasing. This is best suited for individual who have no immediate plans for their pieces of land. By leasing, one is allowed to use land as a factor of production for a pre-determined period without assuming full ownership.

Holding and Resale — This last option requires a lot of patience. The reason is that although land appreciates, it can do so at low rates depending on the locality. Nonetheless, one can make money by waiting for land to appreciate and disposing of it at the right time.