Investing in raw land is often misunderstood as a difficult, time-intensive money sink. But for the prepared real estate investor, this venture has great potential. Here are a few pros and cons to consider if you’re looking to invest in raw, vacant land in Monmouth County.
Raw land has development potential
The most important thing with undeveloped land is that if you have the capital, you can develop the land however you see fit. Sure, you will have to factor in zoning and local land use restrictions, but a smart investor willing to do the homework and legwork has the option to create exactly the kind of property they envision. But if you have yet to come up with the capital, you can also leave the land as is.
Raw land can be more affordable
Vacant land tends to be less expensive than developed real estate. You won’t have to worry about structures and renovation costs as well.
Most investors purchase land upfront with cash. Sellers also tend to be highly motivated to sell. You may be able to score a better deal than you expected.
Raw land is inexpensive to own
Unlike developed real estate, raw land doesn’t come with many maintenance needs. You may need to have the grass mown once in a while, but you can leave the land untouched for long periods of time You also don’t need to worry about tax obligations. Property taxes and fees for raw land are usually cheaper than developed properties.
No immediate cash flow
While vacant land doesn’t require much in terms of upkeep and maintenance, it won’t generate a steady stream of passive income undeveloped. You could sell gaming and/or mineral rights, but if you want to earn more from your investment, you will have to develop the property.
Developing raw land requires research
One of the most important things to do when investing in raw land is to research. A smart investor will know everything about their property, from the local zoning and building regulations to soil surveys, setbacks, and easements. With all this information, you’ll know what you can and can’t do with a certain parcel of land.
Ask the previous owner if these resources are available. If not, get in touch with the local planning department to learn more about the property. Check if factors like fire or flood risk prevented any development. After all, there might be reasons why the land remained vacant.
Don’t think of raw land as an investment that needs a lot of work. Set a clear plan and find the right parcel to make your vision a reality.
Find raw and vacant land in Little Silver, NJ real estate with top agent Colleen Meyler. With over 30 years of experience in New Jersey real estate, she will help you navigate the process of buying land in Monmouth County. You can contact Colleen Meyler here. You can also call her at 732.995.5102 or ColleenMeyler(at)gmail(dotted)com .