Why Buy Land Now?

Yesterday we posted part one of this fascinating article by Marilyn Evans about land investments of all types, and the benefit these investments could have now and down the road. Here is the conclusion of the article.

If you already own other real estate investments, you can use a 1031 exchange to acquire land, says Brownfield. These exchanges permit real estate investors to trade one real estate holding for another but deter any capital gain taxes until the second asset is sold. (Note that 1031 exchanges have stringent rules, so consult an expert when considering an exchange.)

Another ready source of funds for land purchases is a ROTH or SEP IRA. IRS regulations permit individuals to use retirement funds to purchase real estate, including land, through an IRA custodian that offers real estate investments along with stocks and bonds.

“Several of my investors have contacted me recently to thank me for suggesting they diversify their retirement accounts into land holdings,” says Lou Jewell, ALC of Dan River Real Estate Inc., in Pilot Mountain, N.C. “Others have told me that they wish they’d diversified before they lost their money in the stock market. I tell those people that it’s not to late to invest in land. There are still great opportunities today.”

But while there is almost certainly a land investment to fit any investor, finding the property that fits each individual’s goals requires expert knowledge and experience. That’s why the smart first step in making any land purchase should be consulting with a professional land broker, preferably one that holds the Accredited Land Consultant (ALC) designation from the REALTORS Land Institute (RLI).

The ALC designation is conferred only on those land specialists who complete a rigorous education program and achieve a volume of successful land transactions, says Dan Hatfield, ALC, 2009 RLI president-elect and owner of Hatfield Realty in Medina, Texas.

As a professional membership organization, the REALTORS Land Institute serves the unique constituency of real estate professionals who broker, lease, sell, develop, and manage land assets. RLI offers superior education through its RLI Land University and professional development programs, an array of services that encourage networking and referral opportunities, and legislative advocacy on land-related issues through the National Association of REALTORS?.

“One of the real benefits of the REALTORS Land Institute is that whatever type of land you’re seeking, there are RLI members who are expert in that area,” says Gibson. “Whether your interest is shale oil leases, timber, or ranches, RLI members have the knowledge and resources to find the answers.”