While you may not think much of raw land investment, it can open new income streams and become a lucrative investment for investors and home buyers alike.
Most investors are wary of investing in raw land because;
- a) it takes time for developing a property from scratch
- b) raw land might not seem that profitable
However, we delve deep into the benefits of purchasing raw land, developing or holding it, and making hundreds of thousands of dollars worth of profit with just a piece of land!
A highly affordable real estate investment
If you’re a new real estate investor or a first-time home buyer, the overly crowded real estate market and costly properties can overwhelm you. This is when you need to consider buying and developing raw land.
A developed property sitting on a piece of land would obviously cost you more. On the other hand, a similar parcel of land with similar dimensions can be bought for much less. If you have the finances to develop a property, you could always purchase raw land and seek a construction loan to build your own property.
Appreciates over time
The RLI-NAR survey reported over a 2% increase in residential, commercial, and recreational land sales during the Pandemic alone. This strong growth in land sales depicts investors’ interest in vacant pieces of land.
Because just as developed property appreciates over time, so does raw land!
Even if landowners buy and hold a piece of land without developing it, they’ll always walk out of a transaction with more profit in their pockets!
Factors such as infrastructure development, economic changes, developing amenities, and local development make land more habitable. As the area’s popularity begins to rise, so does the land’s value!
Low holding costs
Not only is raw land less costly than developed properties, but it also features low holding costs!
If you plan to let the land sit and appreciate over time, you’ll only be required to pay an annual tax, some maintenance, or holding costs. If you don’t wish to develop the property just yet or intend to sell it in the future, you can let the land sit and increase in value without doing any hard work!
Carve your own path
A raw parcel of land acts just like a blank canvas. You can develop your property with your own construction plan while remaining within the zoning and building codes. You could always have a larger front yard, more space in the backyard, and choose finishing materials of your choice!
With a commercial piece of land, you can always partner up with a builder and build a commercial property that reflects your or is specifically made for a particular business.
Raw land lets landowners build their dream properties at their own pace!
Consider Commercial Private Equity for Raw Land Financing Solutions
While most traditional banks find a raw land investment riskier, Commercial Private Equity thinks otherwise!
At Commercial Private Equity, we ensure that our clients get to build commercial or residential property on the land of their choice. We extend hard money loans to finance the purchase of raw land, and our construction loans can help you build the property of your dreams on your own land.
Give us a call at 404-301-8633 to learn more about our customizable loan terms to finance raw land transactions all across the United States.