How is the Stock Market Connected to Land Investing?
Let’s first admit that most of today’s investment portfolios can be traced in some form to the stock market. I was with some friends yesterday and everyone lamented they took a big hit over the past year resulting in steep declines in their personal investment portfolios. Also I was talking with a business owner whose business CD came due and when he went to roll it over he could only find a short term deal that paid slightly more than 1% interest.
So what does all this have to do with land? Traditionally when returns decline in traditional investment outlets, investors start to look for investment opportunities outside normal channels. For instance, some have turned toward gold as an option. Now many are turning to buy land as a safe haven for their funds.
Let me give you an example. I first cut my teeth on land investing in 2004 in the North Florida area. I was associated with a real estate firm that all they did was broker land. In early 2005 the office was receiving a phone inquiry every 15 MINUTES! In fact, the office could not keep pace with enough land parcels to service the demand (who were ready to pay with cash).
Why was there such an influx of activity to buy land? I asked this question at that time to many perspective buyers. About 80% of them were looking for an investment option outside the stock market. If you remember, the stock market returns were flat for much of 2003 and 2004. So some investors were growing impatient with returns there and begin to research other creative investment options. In fact, the Miami Herald wrote a story about this in 2004. They stated that one of those creative options was to invest in land and suggested North Florida is where someone should invest. After that article, the land brokerage was surprised to experience a flurry of activity.
Conclusion: Stock market returns flat – investors seek other investment outlets.
The question now is: If most investors have currently lost money in the stock market are they going to search out other places outside the stock market to invest in? Absolutely!
So if you are going to invest in land, strike while prices are still low. Because when land investing becomes more mainstream as it was in Florida in 2004 and 2005 as some point there won’t be enough affordable parcels of land available to meet the demand.
Let’s first admit that most of today’s investment portfolios can be traced in some form to the stock market. I was with some friends yesterday and everyone lamented they took a big hit over the past year resulting in steep declines in their personal investment portfolios. Also I was talking with a business owner whose business CD came due and when he went to roll it over he could only find a short term deal that paid slightly more than 1% interest.
So what does all this have to do with land? Traditionally when returns decline in traditional investment outlets, investors start to look for investment opportunities outside normal channels. For instance, some have turned toward gold as an option. Now many are turning to buy land as a safe haven for their funds.
Let me give you an example. I first cut my teeth on land investing in 2004 in the North Florida area. I was associated with a real estate firm that all they did was broker land. In early 2005 the office was receiving a phone inquiry every 15 MINUTES! In fact, the office could not keep pace with enough land parcels to service the demand (who were ready to pay with cash).
Why was there such an influx of activity to buy land? I asked this question at that time to many perspective buyers. About 80% of them were looking for an investment option outside the stock market. If you remember, the stock market returns were flat for much of 2003 and 2004. So some investors were growing impatient with returns there and begin to research other creative investment options. In fact, the Miami Herald wrote a story about this in 2004. They stated that one of those creative options was to invest in land and suggested North Florida is where someone should invest. After that article, the land brokerage was surprised to experience a flurry of activity.
Conclusion: Stock market returns flat – investors seek other investment outlets.
The question now is: If most investors have currently lost money in the stock market are they going to search out other places outside the stock market to invest in? Absolutely!
So if you are going to invest in land, strike while prices are still low. Because when land investing becomes more mainstream as it was in Florida in 2004 and 2005 as some point there won’t be enough affordable parcels of land available to meet the demand.
Learn how to develop a competitive edge as a real estate investor by
applying the principles Russell Ward writes about in his Home Study
Course, Vacant Land Guide – How to Buy Vacant Land at Wholesale Prices.
The turn-key program teaches how to make $5K to $10K per month quick
turning small parcels of land and $50K to $100K per deal on larger
tracts of land in just 10-15 hours per week!
No comments:
Post a Comment