Articles

Invest In Land Or Stuff A Mattress

As featured in Land Investor Magazine Vol. 1

invest-in-land

Over the past seven years, investors have been notoriously careful with their cash flow, avoiding risk and staying cash heavy. This is no surprise. Due to the economic crisis in 2008, many investors and wealthy individuals became more risk averse with their portfolios, and began saving money instead of investing.

However, last year’s annual CapGemini/RBC survey of investors worldwide showed the number of households worth more than $1 million in investable wealth has risen 60 percent since 2008. This wealth is predicted to continue to increase by 22 percent by 2016.

As cash accumulates though, it is predicted that domestic taxes may be imposed on cash holdings themselves. This cash-hoarding psychology in itself reveals the anxiety many investors have to part with their money. It’s a deep concern, and one that is reinforced by the increase in taxation on income, capital gains, dividends, gifting to heirs, and possibly, even on cash itself.

However, the tax benefits of investing in real estate are appealing, particularly when it comes to investment-quality ranchland, farmland, and timberland investments. Land investments have historically had (and will continue to have) real, intrinsic value that can be built over time, returns boosted and diversified through thoughtful management, and is a particularly appealing asset allocation and capital preservation strategy.

So, should you invest in land or stuff a mattress? I’d say invest in land.

 

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