Investing in Land: A Safe Move?

Land, a finite and tangible asset, can appreciate over time and serve as a valuable addition to any investment portfolio. Here's a rundown of the key points to consider when investing in land.

Firstly, land can be held for future development or sold when the market is right, offering potential for higher returns, especially when located in the path of development. Compared to owning a home, investing in land requires less capital, making it an accessible opportunity for many.

One of the advantages of land investment is the ability to invest worldwide in the best markets. This global reach allows investors to capitalise on growth opportunities in various locations. For instance, in 2025, attractive countries for land investment with promising potential for future capital gain include the United Arab Emirates (particularly Dubai), Poland, and several Eastern European countries such as Romania, Bulgaria, and Albania.

However, it's important to note that selling land can involve steep transaction costs, real estate agent fees, and title insurance. Furthermore, land investment is generally a longer-term strategy, with the potential for illiquidity. Raw land does not generate immediate cash flow and may require development before it becomes profitable.

Investing in land also avoids the challenges and additional costs of building structures. Land flipping, or finding off-market land at discounted prices, purchasing it, and making improvements as needed, is a strategy gaining traction, especially in emerging markets with lower purchase prices.

When it comes to overseas land deals, local knowledge is crucial. Services such as Nomad Capitalist provide hands-on support to investors and entrepreneurs entering offshore markets. However, it's essential to be aware that some countries may have rules about foreign ownership, but these are the exception, not the rule.

Land values often increase with property prices, particularly in areas where more people are moving in. Adding land to an investment portfolio can help spread risk, as its value does not always move in sync with stocks or other assets.

Investing in land is often perceived as complex and fraught with potential legal hurdles and questions about safety and returns. However, when done diligently, with a thorough title search, assessment of easements and liens, and careful consideration of location, zoning regulations, and potential future development, land investment can be a relatively safe and rewarding long-term strategy.

Lastly, land flipping or speculation is gaining traction as demand outpaces supply, allowing investors to seek faster profits. Emerging markets, with their lower purchase prices, offer the chance to benefit from rising real estate markets.

In conclusion, investing in land can be a valuable addition to any investment portfolio, offering potential for long-term growth and diversification. However, it's crucial to approach land investment with a clear understanding of the market, potential risks, and the need for due diligence.