As a limited commodity, there is an inherent stability in land ownership. Additionally, there are several ways for real estate investors to benefit from adding land to their portfolio. Some of them seem pretty obvious, but others require a little more out-of-the-box thinking. Before you make such a large investment, it is beneficial to explore the array of methods to earn the best possible return on your dollar. Additionally, you may find that you are excited about what lies ahead with your new holding. In this post, we look at 5 ways to make money from vacant land in Arizona.
1) Divide and Sell
Creating “new” land is a creative way for those who invest in larger tracts of land to realize a return. These investors profit by subdividing, which increases the value of the entire tract. There is a great deal of profit to be realized by selling off smaller plots of vacant land in Arizona. While this is a relatively simple method of investing in real estate, you should still do your homework. You will want to have professionals that you can rely on for assistance with zoning or other issues that may arise through the process of subdividing the land, with regard to environmental issues, paperwork, deadlines, and local and state laws.
Building on your vacant land has quite a bit of potential to bring in more profit. These days, there’s a pretty high demand for housing. More often than not, buyers prefer homes that are move-in ready. Often, investors buy large tracts and subdivide with plans to build spec homes which is a highly profitable way to make money from vacant land in Arizona. Before undertaking this task, it is important to be realistic about the overall financial demands, having laid out a long term plan and securing a solid team to help you realize your goal.
3) Renting Land Space
Owning land is something that not everyone has the ability to achieve, however, they still desire the benefits, such as growing a personal garden or cultivating a variety of crops on larger tracts. Depending on your location and local zoning, you may also be able to rent the land to hunters or use it as a storage area for RV’s, boats, and the like. While more complicated, with the right property you could also consider building a campground business, if there is a demand in your location. Renting out sections of your land to individuals for use is another way to make money from vacant land in Arizona. While holding land for the long term as an investor does mean a gain, income from the land can be used to offset the expense of property taxes.
One of the simplest ways that an Arizona real estate investor can realize a very nice profit on vacant land is by holding the property for the long term, especially if you get a really good deal. You could also hold the land, but lease it out, covering your costs of owning the property, and still sell it after several years. These are two relatively simple methods of making money from vacant land in Arizona. Just as with investing in the stock market and holding for the long term, there is no guarantee of high returns, however, they are likely.
5) Short Term Lease
Depending on the location you select for your land investment, temporary leases to retailers of holidays or seasonal products can be a great way to make money from vacant land in Arizona. These products could be anything from a fireworks tent every Fourth of July, pumpkins every October, or an annual Christmas tree lot—there are a variety of possibilities. Many investors in this type of real estate are able to live extremely comfortably off of this type of transaction. Any inconveniences of dealing with the rental agreements and legalities of the public being on your land are offset by the profits, which can be quite impressive.