Tuesday, 4 June 2013

b.Land - The Future (Part 3 of 4)

Time to discuss the third part of the Land essay. The second part is located at Land - The Present (Part 2 of 4) and first part is located at Land - The Past (Part 1 of 4).

The Future

One of the most important lands that one must get is a waterfall land. It is most pleasing. I still haven't gotten mine yet. Still choosing. hehehe ... So no worries. You will surely be able to do catching up. Those lands that have river or lake or hill are also pleasing. I have already gotten some of them. So you better catch up fast.

Repository of cash -   Most guys think that they can make money from "investing" in land. There is no such thing. Buying land is not an investment. Neither is buying properties that have houses or buildings on them. The worst form of purchase is however strata lots. Land itself has no meaning. It is almost like gold. Worthless most of the time. Even in recession, gold is a useless piece of metal. The only time it is useful is when you need to run away from military juntas. Land is merely a store of value, i.e., it protects the purchasing power of the owner for the future. So stop thinking that you can make money from "investing" in land. If you can make money from land purchases, long ago banks would have owned millions of properties. But, it is not the case. It is at best an illusion.

Developing land -   You must never build haste into the development of the land. You must not think that there are no budget hotels nearby, hence, building a budget hotel on the land will make money. It will not. Let demand pushes you to build or develop. Otherwise you are better off leaving the land in its original natural state. I used to like to think ahead of the game, trying very hard to outsmart the market. But, I was always made wrong and got punished badly by these misadventures. I lost tons of monies and would have great difficulties later to regain my composure. Indeed, even in the end, the city engulfs your land, you might be the only greenery left. City folks will end up queuing to come into your land for that break from their tiresome city life. 
Change of use -   Let the government of the day changes your zoning. Don't apply for the change. If the government changes, it meant that the land is ready for the next phase of development. Take your time and develop something nice and proud to own. 

Taxes -   Again, I need to emphasize this. Taxation is a real killer of joy. So read the taxation laws well and build a nest egg to handle it well before it catches up on you. The best method is to collect and save up the rentals for a while.

Geographical diversity -   As clear as the day.

Sizes -   A university needs 500 acres. A ranch needs 500 acres. A large farm needs 500 acres. A theme park needs 500 acres. A nice vineyard needs 500 acres. I know Stanford University has 8,000 acres. But, try not buy any thing too big. You can't manage. I suggest the maximum size to be 650 acres and try to buy some smaller ones as well. A small 10-acre to 150-acre land is fun and flexible. However, there is no hard and fast rule for the various sizes. You have to gauge its flexibility of use for the future.

Building businesses -   It is good to build businesses on these lands, as these personal businesses will help to shore up the income potential of the lands. In the end, these businesses will help to provide a stable source of income streams to you.

Rentals -   Life is never just work and no play. Don't be too hard on yourself, rentals collected can be used for enjoyment. After all, next month the rentals return.

The next part - In Perpetuity - I will discuss the government interference and the transfer of ownership.

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