Have you ever wondered what it is about land that makes it such a valued investment? I have my own thoughts about this that I share routinely as I consultant clients about the nature of land investing.
Dirt is real, it is tangible and it is not just a piece of paper or a number on a screen. In an age of electronic accounts, many people are realizing that investing in real estate is something that gives an enhanced level of financial certainty. With the technology available to monitor conservation, soil health, and production it has certainly opened up the appeal to the analytical focused buyer too.
There is something to be said about working the soil like your father before you and possibly your grandfather before that. Most of the investors I consult with are very successful in business, but grew up as farm kids in the Midwest. They still see land as the premier investment tool globally and it serves as the anchor to their Midwestern upbringing.
Scarcity is always a factor, as in the time it takes you to read this the world population has jumped by hundreds. Not only is scarcity a factor on a local level when a family farm may only have one chance every generation or two to purchase the adjoining eighty acres. Scarcity is a big factor when considering the amount of land taken out of production every year and a forecasted world population that is downright staggering. We are at a time in the Midwest where commodity prices having declined drastically from record levels but land prices have not followed proportionately. Much of this is due to the lack of available properties and the location scarcity that is a stable of land acquisition. Unlike other investments, some land parcels will not be on the open market in generations.
Land ownership also represents freedoms not realized in urban situations. Last weekend I spent the afternoon riding ATV’s with my daughter on a timber farm I have. Frankly we didn’t get much done in regards to farm work, but the memories and time spent with her are priceless. These are just a few of the reasons why I firmly believe everyone should be considering land in their future.
Eric Schlutz, ALC
Accredited Land Consultant, Past President Iowa Chapter #2- Realtors Land Institute
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