As you look around the Bay Area, you will find tremendous growth, with little land available. Construction projects prevail and business is booming! Then there are the projects most Californians aren’t even aware of that is causing the largest land rush in history.
With the reality of California’s population growing at such an alarming rate, a strong economy, and the lack of available, much less affordable land, we have created a perfect storm. While growth patterns top the charts, and the desire for this precious limited resource mounts, individuals and investors turn toward alternative ideas that make more sense for them, seeking ventures that do not break the bank.
Historically, California’s population grows at a rate of 250,000-350,000 people per year! Statistics from March 2017, show growth by 0.7% in the Bay Area. This progress not only minimizes the availability of our precious land, but also drives up the costs, sending savvy investors towards this scarce resource.
Land Banking, the art of investing in land that lies in the path of growth, creates an alternative investment plan for those who would like to explore other opportunities. As our land becomes more scarce, it also becomes more valuable, basically - supply and demand at its best. Just imagine if you had purchased land in the Bay Area 20 years ago for $5000/acre, and now it’s worth well over $1,000,000/acre…This is the power of land banking!
While some choose to and struggle with “toilets, termites, and trouble,” other investors flock to find the best bang for their buck without the headaches of getting involved in bad blood with tenants. They realize that there has to be something else to quench their thirst for why they invest in the first place.
Investing in land is a great alternative for those who want to do a 1031 exchange, who have an old 401k or IRA that is underperforming, or for those who have some cash that they just are not sure about where they can invest it for a great return.
Land banking, with the proper guidance, is a creative solution for the average investor who would like to increase their wealth. By safely and affordably investing in the right land, your financial future can be worry-free.