There is a limited amount of land in the United States, which means it can be a valuable asset — especially in a high-growth area like Central Florida. In fact, owning land is one of the easiest and most effective ways to build wealth.
There are multiple ways to invest in land. You can simply acquire a property, start a land-based business, or even place funds into an exchange traded fund (ETF). If land ownership sounds like the most appealing option to you — there are a few risks involved. Knowing how to evaluate a property is the key to making a good investment.
The good news is investing in land is easy when you work with experienced land transaction specialists like the ones at Palmetto Realty. Here is how you can begin investing in your very own Central Florida property today.
Types Of Land Available For Purchase
Purchasing land is a great investment. The average appreciate of land typically falls somewhere between 2% and 4% each year, depending on many factors. Before you purchase land, you’ll need to know about the different types available on the market as well as the benefits and disadvantages of each one. The three primary types of land include:
- Raw Land
In many cases, you can’t even access raw land by road. Therefore, it holds less value than developed land because it requires major investment to build infrastructure and utility access in order to make it functional. However, raw land is much less expensive than developed land and there are some valid land-based business concepts that could thrive — such as using it for recreational hunting. Raw land is the riskiest investment; however, it’s still has the potential for strong price appreciation because it’s limited in supply. - Unimproved Land
Unimproved land is usually accessible, but it lacks utility access and basic infrastructure needed to support residential or commercial development. Undeveloped land in Central Florida is often in rural areas. These lots are worth more (and they cost more) than raw land. Unimproved land can be an appreciating asset without any development, but if you plan to build a business on the land, you’ll need to invest in the necessary infrastructure. - Improved Land
If a lot has access to utilities and infrastructure, and it doesn’t require significant development, then it’s considered improved land. Urban or suburban residential or commercial lots with no buildings are considered improved land. These lots appreciate faster, but they’re also the most expensive.
All three types of land are considered appreciating assets, even if you simply purchase the land without the intent of development.
Transforming Your Land Into A Business
One of the most effective ways to invest in land is to acquire a lot and build a business. There are dozens of business concepts that you can start simply by owning your land. Not all businesses require development — there are many simple things you can do, too. Here are a few of many popular business concepts you can start by investing in land in Central Florida:
- Start a Farm – Florida is a top state for agriculture, so buying farmland can pay off in a big way. The key is to acquire the right size and type of land that is suitable for what you intend to grow or raise. You could even board horses on you farm for some extra cash.
- Sell Storage Space – This is an easy idea with minimal overhead. Use your land as storage space and where customers can keep their boats, RVs, jet skis, or more.
- Open a Driving Range – Golf is highly popular in Florida and a driving range is another business concept you can start with minimal costs.
- Hunting Land – If you’ve always wanted to own hunting land, you make your dream come true. Buying land with lots of acreage and wildlife creates an opportunity to charge others to hunt on your property.
- Start a Campground – Buy a beautiful property with acreage, a small pond, and road access and you can easily transform it into a campground with minimal overhead.
- Build Apartment Rentals – Central Florida is a high-growth area. Investing in land to transform into apartment rentals requires quite a bit of start-up capital, but it can be highly profitable in the long-term.
Investing in land and starting a business on your property can lead to rapid appreciation and meaningful short and long-term returns; however, it’s important to make sure you’re choosing the right lot. You’ll need to make sure land is suitable for construction and zoned for your intended use. A good land broker can help.
If you’re ready to start investing in land, don’t attempt to go at it alone. Trust Palmetto Realty to help you choose the right property.