Investing in land is still a relatively new concept for many property investors, who may be more used to thinking in terms of net yields, rental income. But increasingly, plots of land in emerging worldwide property markets are becoming a popular method of growing an investment portfolio and diversifying into multiple markets with minimum risk.

5 simple steps can make the difference between land investments that rock and deals that feel more like a dead weight:

1. Choose a Growing Country

Although not impossible, it’s tough to make good returns from land investments in a market that’s generally falling. Instead, you should look for emerging market countries that display a range of positive economic indicators, such as rising economic output, a growing population, a falling number of occupants per dwelling, increasing levels of personal wealth and inward investment from other countries.

2. Target a Sought-After Area

Remember that you can only make a profit from land by selling it. This means that someone else will have to buy it. The location therefore needs to be one in which other people will be likely to want to buy land or own property in the future, and preferably not too far into the distance. A piece of coastline may be beautiful, but if it’s impossible to get to and no-one ever goes there, it’s unlikely that the prices are set to explode. Look instead for areas that are in the beginnings of a growth period, where future development will help drive prices.

3. Ensure the Land will be Developed

Raw land will only grow in line with the market if it stays classed as raw land. To really accelerate in value, it needs to be transformed into developed land, complete with water, roads, electricity and other such utilities and services. This is normally too big a job for an individual ‘small’ investor, so buying a plot of land on a project where the developer is committed to delivering these improvements is a good idea.

4. Pay the Right Price

The price you pay for a plot of land should reflect the fact that it is not yet the finished article, although it is not uncommon for subdivision plots to be priced at a level that to a certain extent takes into account the future improvements the developer will make to the project site. Local market sales can be a good barometer for the validity of the pricing. If the domestic population shun the resort, then it can be a safe bet that the project is somewhat overpriced. On the other hand, if it’s good enough for the local market, it should be well priced for international investors.

5. Be Patient!

Investing in land won’t make you a millionaire overnight (unless of course a supermarket or developer is so desperate to get their hands on your plot that they make you an offer you can’t refuse). Land banking is a long-term concept that should be approached from the perspective of 5, 10 or even 15 years at a time. It is over these sorts of timeframes that real change can happen in a local area and it is only with these changes that the price characteristics will be dramatically altered.

Dan Johnson, Managing Director, comments:

“Done properly, investing in land should be a safe bet for long term growth. Provided you stick to this simple 5 point plan, you can’t go far wrong.”

For more information on Properties in France in general please visit http://france.themovechannel.com

Notes to editors:

TheMoveChannel.com is a property website that was founded in 1999 as an online resource for buying, selling and learning about property. It now receives as many as 300,000 visits per month and advertises over 50,000 properties in nearly 90 countries, which are listed by over 500 partner organisations.

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