If you are one of those people who like to invest their money in different areas, land is something you should consider. However, there are many things you need to consider before you invest in a section of land. Land can be a great investment if the right amount of research has been put into it. At the end of the day, nobody wants to invest their money into something they won’t profit from! Nevertheless, there can be a lot of profit in land and property investment. Let’s look at the question you need to ask before you invest in land.
Is Buying Land A Good Investment?
One of the most important questions you ask yourself is whether it is a good investment. The short answer is yes, it is a fantastic investment but only if managed and researched properly.
Firstly, the land is very profitable and only requires a small amount of money until it is yours. As time goes by, the value of your land will increase however, it depends on the area you have purchased your land. If it is up and coming, the return on investment can be a high amount in the next five to ten years.
Land requires a long-term strategy, and you can’t expect quick returns with it. You also need a plan with the land that you have purchased. Do you wish to build on the land or, would you like to use it as a storage place for other people to use? Whatever you plan to do with the land, ensure that there is a long-term approach to your investment.
As you will know, the population is continuing to grow in the UK. That means there is an increased demand for both residential and commercial property. If commercial property is something you are interested in, this could be a good way to make use of the land that you have bought.
Ask Yourself Why You Want To Buy The Land
If purchasing land is something you wish to invest in, then there are likely other opportunities for investment as well. Before you invest money, you need to consider why you are doing it. Why is land better than investing in property? What will you do with the land? These are all the questions you need to ask yourself before you invest.
Are you planning to build a home on the land or use it for commercial purposes? Either or are good reasons to why you should buy land however, there is more to it than that.
What Different Types Of Land Are Available?
There are several different types of land that you can buy in the United Kingdom. There is Agricultural land, Brownfield Land, Contaminated Land, Green Belt Land, Greenfield land and Strategic Land. Let’s take a look at what the different types of land have to offer.
Agricultural land is where you will use this land to grow fruit and vegetables and provide a home for livestock. This land is only for farm use so if you are considering turning this into commercial property, it isn’t for you.
Brownfield land is where commercial or industrial buildings were once built on this land before but now they are no longer in use. This type of land is typically much cheaper and can return a lot of money. The reason why this is so cheap is because it will benefit the surrounding area, turning wasted land into something more useful.
It is when a hazardous substance is found on the land and therefore makes it contaminated. That includes oil, gas, asbestos, chemicals, radioactive materials, tar and some dangerous metals.
When investing in this type of land, it can be difficult to extract the dangerous materials there. Again, this type of land is very cheap as you are promising to improve the area and extra any materials which damage the environment.
Green Belt Land
Green belt land is slightly more expensive than the land previously mentioned. It is the area which is protected by authorities to ensure commercial and residential property is not built on it. This allows it to not be turned into a more urban area and keeps rural. Nevertheless, there are exceptions to allowing you to build certain buildings there. It would often include agricultural property or recreation.
This type of land includes rural and urban areas. It is usually land that has not been developed or has never had any infrastructure built there. This type of land has many advantages as well as carries a few disadvantages. Due to a lack of previous infrastructure, there is less work that needs to be done to this land to make it habitable. Moreover, local authorities may refuse certain planning permission if they believe it will have a negative impact on the surrounding area.
Strategic land is any land that could be profitable in the future. This could include that land in a developed or up-and-coming area. Therefore, this land will be valuable as other buildings are being built around it.
Strategic land is more appealing to property developers. They will usually use a construction plant hire company to hire machinery that they can use to make the land even and useful. This machinery will also be used to build residential or real estate properties. Once the project is completed, the building will either be sold or rented out to tenants, driving more income in the future.
Make Sure You Complete Enough Research
Something else you must do before you buy land is research. Don’t just check what is being built around that piece of land, look at other areas to see the going rates of land and choose the cheaper ones that require less work and could be more profitable.
Something else you must research is the demand for land. If there is a high demand for land, this would increase the value of the land. However, if there isn’t much demand for land, it will be far cheaper. Depending on what you want to do with the land, we advise you to consider the market before making the decision.
Do Something Different To Other Investors
Before you make your decision, we advise you to research online to see what land is available. Many land investors will start going through an agency and that isn’t recommended at this stage. Most of the time, the valuation of the land will be much cheaper if you don’t go through a land agency.
Another great place to find cheap land is through auctions. Plus, you can this to network with other land investors and see what knowledge they have and if they have any land for sale at the moment.
Check The Location
This should be included in your research before you start your investment. Location is always important when you consider building residential and commercial property. If you research the location surrounding the land you wish to buy, you might actually believe that is overpriced. However, it can work the other way and be undervalued, therefore, will be a greater return on investment.
If you are considering building residential or commercial property, look at the transport links that surround it. If it is difficult to get to, people won’t look to move there or work there. Furthermore, there could be news that the local council are looking to revive the area, building a new property and commercial buildings themselves. Therefore, if you beat them to it, owning this land, you could also build real estate property as it would be likely that the planning permissions would be accepted because you are also looking to improve the area.
Consider Planning Permissions
The reason why you should always consider planning permission. Before you buy the land, make sure there is no planning permission in place. This is where you will require a lawyer to help you decide whether it is a worthy investment and, if you can build on the land.
If you find land for sale that has no planning permission, ask why there is no planning permission. There might be reasons why this land is for sale but doesn’t have planning permission.
Get A Land Surveyor
As you eye up purchasing land, you need to get a land surveyor to ensure you can build on it. The area could be at a high risk of flooding and could make it a risk for people to work or live. The land surveyor will also help you eliminate the doubt you might have about that land. If they
won’t it be best not to go through with the purchase of the land?
Remember To Always Consider The Long-Term Plan
Sometimes, your short-term plan may not always work out and you should always expect to make money in the long term. Buying land won’t get you rich quickly. You must always plan for the long-term future of your investment. Will it increase in value and make it worth your investment?
If you are looking to build on the land, you need to plan for a long-term investment. This will require planning permissions and a plan.