Land Investment Takes A Long View
Large profits can be made in land investment. A long view and patience are the keys to success. There are many stories of persons who made great fortunes by investing in land and holding that land for long periods of time. Bob Hope, who became one of Hollywood’s richest entertainers before his death, supposedly gave the advice, “Buy land, and never sell.”
Most land investments are not income producers. The investments are made almost wholly with long-term capital gains objectives, unless the land is bought specifically for development. Because of the lack of income, successful long-term land investors need separate income-producing businesses or separate sources of income. They need sources for land investment capital in order to build their businesses.
It is not uncommon to see a real estate investor or a real estate investment company operating in several real estate areas. Some have property development activities, apartment ownership or property management operations. These functions all produce profit and cash flow in the short-term. The profit and cash flow in the short term can provide a stable base for long-term land investment activities and long-term growth.
For one considering a long-term land investment program, it is essential to have a souce of funds to pay the monthly bills. Above and beyond the monthly bills, there must enough cash flow to fund land acquisitions on a continuing basis. It is possible for a person without substantial assets to start and build a successful land investment program. To do so, however, It is absolutely essential that income sources be planned and assured so that growth objectives of the land investment activities can be met. See Land Investment Pointers for more discussion.
Many variables come into play in speeding the growth of your real estate investment business. One of the most important is the availability and use of good financing sources. Another is the awareness and employment of available financial services. A third is creative application of the resources found in investment services.
Using these tools allows you to make large and rapid strides in developing your business. It takes some work and some practice, but you can master them fully if you concentrate on it. Just keep in mind that these areas are worth the trouble to learn, because they can give a great return on your effort.
The ability to secure financing for an investment when you need it is critical to achieving success. This is true on an individual project basis, and is especially true in a long-term investment business plan. A successful real estate investor attends to the financing aspect of his or her business in the early stages of its development.
For a listing and ranking of the best real estate and related financing sources, go to Top 10 Financing Sources.
There are several reasons to keep your mind open to a property trade, and to be ready to trade when circumstances dictate. Many real estate investors do not understand the the basic facts of trading. They have never considered a trade, much less done one. If you will take the time to learn about trading, and learn when trading might be a great solution to a problem, you will be far ahead of many real estate investors.
Sometimes you find yourself with a real estate investment that just won’t sell at a price you can accept. For whatever reasons, the property you want to sell is just not attracting interested buyers. Maybe it is not attracting buyers because of its location, or because it is the highest-priced house in a neighborhood, or because it is has special-use improvements, or because financing the property offers challenges.
Whatever the reasons for the slowness in selling, the difficulty may be overcome in a trade where both parties to the trade get something they want. It is possible that the other party to the trade is dealing with issues of slowness in sale or lack of buyer interest just as you are. Either or both partners to a proposed trade may have tax considerations that point them in the direction of a trade.
In any case, you will be better off if you have the basic ability to evaluate and execute a trade. You may, through a trade, solve the problem of owning a slow-moving property. You may accomplish more than that. You may find value in the property you trade for that did not exist for the previous owner. When you find yourself in such a situation, It is time to open your mind to a trade. See Property Trading Facts.
