Buying land is a wonderful way to invest in real estate. However, not all land is created equal. If you are considering adding land to your investment portfolio, take some time and learn about the different types of land investments available in Arizona. And then check out Southwest Land Deals and we’ll help you find the best piece of land to fit your needs.
Before you purchase a piece of land, there are a few things you should first consider.
- What is your investment style? Do you want to buy and develop? Or are you looking to buy and hold the property, selling when the land appreciates.
- What can you afford and how will you be paying for the lot?
- Have you budgeted for development costs? Property taxes? Any other possible fees that may come up?
Buying recreational land as an investment is a profitable and enjoyable asset for many investors. Recreational land is typically used for hunting, fishing, hiking, camping, off-roading, and more. The benefits here are two-fold: 1) the land will appreciate in value, and 2) you can enjoy the property while it does. Many investors love these features combined with little to no maintenance. This type of land is something we know very well, and we currently have a number of properties perfect for recreational use.
Some investors will buy large parcels of land and resell to developers or sub-divide the lots themselves, selling the lots individually for a profit. Depending on the size of your parcel, you might need to create roadways and bring in utilities to make developing feasible. Sub-dividing the land can be a lot of work, however, the profits can be high when done correctly. This is something typically done by more experienced investors.
Undeveloped land is a great buy. The potential for the land is limitless. You could create a recreational location, turn it into a camping site, set up targets for long-range shooting, establish a working ranch or agricultural farm, or use it as an event venue. Getting basic infrastructure set up might take some work but once it’s all done, you will have immediately added value to the property. Or if you are not planning to do any sort of development, you can always hold the property until property values rise and then sell when the time is right.
Buying commercial land can be a great strategy for real estate investors in Arizona. Take a look at up-and-coming areas and look for the deals before prices begin to rise. You can develop the lot, use it for parking, or flip it when it is in high-demand. If you are not buying the property in cash, make sure you are working with an experienced commercial lender to obtain a business loan. This loan will likely have a higher interest rate than a standard business loan.
Infills and Single Lots
Infill properties are the lots not developed when a developer purchases a large tract of land. These lots are likely near a city or suburban area. Finding these lots at a low price presents a great opportunity for you to flip. The demand for finished lots, ready to be built on, is high. For most people, buying land is the first step in building their dream home. You want to make it as easy for them as possible.
Before purchasing any property, make sure what you want to do with it is feasible. Budget for the purchase and development costs so you don’t find yourself in over your head. Double and triple check the zoning laws to make sure they are working in your favor. You will likely want to have a land survey done as well as a professional valuation for larger parcels.