I have land and property investments in (3) desirable USA locations. (Have done this for 40+ yrs)I'm also curious to see, how the OP fared. The particular question is, how did the proposed 30-40 acre parcel of land, appreciate over the past dozen years? What were the carrying costs? How did investment in such land, compare to investment in stock/bond index funds? .... Should this person buy now, or wait until the finality of retirement?
High growth areas / desirable props can see 10-13% annual equity growth in land prices, but typically for bare land it is 3-6% (annual)
Depends where in MS, but it is generally not a high property value growth area (for the 30- 40 acre parcels) - usually it will be rural / small town; and not in huge demand, because farmable land (income producing AG is 80+ acres minimum, often 640+ (entire 'section' 8x80 acres))
Acceptable formula for someone doing this.
1) Buy only marketable properties you are able to resell, if plans change.
2) Least expensive to buy a non-production portion of a working farm (woodlands / steep / wet / rocky) - if zoning / code / growth management allows splitting acreage.
3) Consider buying a parcel with a legally placed and permitted trashed mobile home or abandoned house (Water well, power, septic, permits, egress, fencing, driveways, landscape (~$100k combined + permits) is all included in price of land) Save yourself the grief of finding out later, your bare land is not allowed to be developed
. (This happens a lot, as zoning / growth management rules change)4) If you find a legal and desired place, and it's going be years before you can build / move there
...a) How will you protect and maintain it? (what are taxes and insurance burdens)
...b) Can you pay cash? Bare land is hard to borrow against
...c) What are your options for getting some cash flows? (Sublease, build a very cheap rental home (repossessed Mobile home), add a shop with apartment, RV hook-ups.
...d) At minimum, install your well, and septic, as rules change and later you may not be able to install well, utilities / septic / driveways.
Done correctly, You can get 10-12% income + 10 - 12% equity appreciation while waiting for your time to transition there. Plus it is being cared for by tenants. (Retired military couples usually make good tenants)
Statistics: Posted by Wash.Invest — Thu Jan 11, 2024 8:29 pm — Replies 43 — Views 6535