I'm considering investmenting in some property and going in 50/50 with my best friend. We're considering a piece of property in a rural part of Houston but one we both feel will be have potential to be a nice commerical piece of property in another 5-15 years or so. I don't currently have a house, I rent and appartment with my wife, but feel it is a good investment since we don't have anything that is currently building equity that isn't depreciating. It is a great deal in my mind and I'll do a bit more research but what I'm wondering is, do any of you guys have experience in investing in just land? Hell, I might want to build on it one day, so either way feel it is a good thing. I'm still kind of young, 25, but I've been told and I recognize that land is a great investment. Anyone got any experience or first hand knowledge? Thanks.
my bro buys old up condominium and fixes them up and sells them for a good profit. makes a good amount of money
commercial property is a great investment.... be prepared to have money saved up to pay the property, school and mud taxes every year.
now, is that something I can look up through public records? I was expecting to have to pay some kind of taxes or insurance or both. If it is pretty rural, you think it would be a lot?
I wouldn't do it. Investing in land is a pretty risky proposition. A lot of people get rich buying land for long term development, like you're saying. But they don't sit around hoping it'll be worth something. They will go to the local city commissions and turn a piece of property zoned for residential into a property zoned for commercial, for example. You say you don't have anything that is appreciating. Who's to say that the piece of property will? Plus, in real estate investment, the safer bet is not to go for appreciation but for cash flow. Buy a duplex and rent it out. You'll get both cash flow and appreciation. Buy a piece of land and you'll just have something you'll be paying tax on for 5-15 years with no cash coming in.
I will sell you a duplex in Wylie, Texas right now. Actually, I could sell you two of them if you're really interested. As for a land investment, generally speaking, if development really is imminent, then that's going to be built into the price you pay and you're less likely to get a premium from someone else. If development isn't quite so imminent, then you have to worry that the development you're expecting ends up coming much slower than you anticipated. For example, I know a guy back in Amarillo who's been making a killing over the last seven or eight years selling land along I-40. There's a hotel building boom up there for some reason, and a bunch of hotels, a bunch of restaurants, a giant movie theater and even a post office have all come and bought land from him at a tremendous premium in order to build all this development. However, when he bought the land nearly 30 years ago, he thought he was maybe five years away from that huge development. It came a lot slower than he anticipated, and it was only because he could afford to sit on it that he's seen the returns that he wanted. There are some other people I know who bought land in the direction the city was growing only to discover that the city quit growing that way. If anything, the city is shrinking away from that area. Development that had existed is closing down, getting torn down or otherwise being abandoned.
thanks for the imput, I wouldn't mind holding onto it to build on one day either so strictly profit wouldn't be the only name of the game....seems so cheap not to do though and I guess that is what makes it so tempting
I don't know if this is too forward... but could you give me an indication of the price? I do some property investment in Dubai and am curious to know what you mean when you say it's a good deal... Maybe don't mention the area but give me a price range? If you aren't comfortable with it, that's fine, I'm honestly just curious..
Sounds like a good investment to me, just rent the thing out rather than sit on it. I don't see how you could go wrong if the location is good.
Right now is a fantastic time to buy rental property. I'm not too keen on the commercial property speculation, though.
The property may be a good deal, but you really have to check your finances before doing deals like this. Unless you are expecting rental income, it is pretty expensive to maintain the property (you'd have to pay taxes, mortgage, maintenance and such). Also, land isn't the easiest thing to liquidate either in case you run into financial troubles. IMO, investing in property in states with lower property tax is a good idea, but not in Texas.
land speculation is only for people who have lots of money and willing to take a gamble long-term.. what you need is something which already makes money or will make money in the near future check loopnet.com or commgate.com try to buy a commercial bldg/strip center which is partially vacant and being sold for cheap.. good thing is it already has rental income and you may have to fix it a little bit to get more tenants or put up your own simple business like a dollar store etc.
Speaking of rental properties, my wife's step mother started buying houses that came on the market in her neighborhood about twenty years ago and began renting them out at basically just enough to cover the mortgage and maintenance. Now she's paid off several properties and getting close to paying off others. The rental homes she has (and she really doesn't have that many - maybe 5 or 6 houses overall) have a current net value of about $775,000. And she built that nest egg with very little of her own money (the mortgage bought the property and the rental income covered the mortgage payments, taxes and maintenance. And as the properties get paid off, the rental income is largely just profit). It's not foolproof, of course, but it seemed like a pretty good way to build a net worth over time.
