Since ancient history, buying and keeping land has always been an investment worth taking. In this day and age, the sentiment still rings true. Here are six reasons why land will always be a good investment.
It can be used for various functions
Land can be used to build a residential development or a type of commercial property. It can also be used for farming or transformed into a ranch or equestrian property. It is not uncommon for landowners to lease their land to local farmers to take advantage of its productivity, generate additional income, and maintain agricultural tax exemptions.
Some land investors develop recreational real estate— another opportunity you can look into. All potential functions and uses considered, the best part is that you can take the time you need before you develop the land.
Land requires less maintenance
Maintenance is one of the aspects in real estate investment that can drive up the total cost of the venture. Unlike most forms of real estate, however, land only requires minimal maintenance. You can leave it alone, as is, for long periods of time.
Land is a limited resource
As the Dallas-Fort Worth area continues to grow, land becomes a much more lucrative and long-term real estate investment. Since land is a limited resource, this demand can increase its inherent value, especially if it is located in the path of growth.
Land cannot depreciate
There is no need to fret over land losing value over time. As it is a raw investment and an essential resource, it cannot be destroyed by natural or even man-made circumstances.
It does not require active management
People have different investment management styles. If you are somebody who prefers to maintain an investment portfolio passively, buying land is an ideal option to take. Since it barely requires any maintenance and can be left alone for long periods of time, you will not have to deal with management issues as much as when you invest in brick-and-mortars. The land will be there and it will continue to earn money passively.
Owning land is cheap
If you are investing in vacant land, there are no utility and maintenance costs to shoulder. Moreover, property taxes for land are inexpensive. When purchased with case, you also do not have to make monthly mortgage payments. Moreover, if you invest in land in the Dallas-Fort Worth area (or any other part of Texas), you can benefit from tax provisions for agricultural land. These include lower appraisal rates for agricultural and open space land and the following tax exemptions:
- State franchise taxes
- Sales and use on farm inputs and products
- Sales and use of motor vehicles for agricultural production
- Sales and excise taxes on fuel used on ranches and farms
In order to qualify for agricultural and open space land valuation, the land must meet the following requirements:
- It must be currently used for agricultural production
- Its principal or primary use must be agricultural
- It must have been used for agriculture for any five of the seven preceding years. If the land is located in a city, the time frame might be changed to five consecutive years.
As the landowner, you must also file a valid application for agricultural valuation with the appraisal district between January 1st and May 1st. Read more about agricultural tax provisions in Texas here.
Interested in owning land in North Texas?
Sarah Boyd and Company can help you find the right plot of land. Get in touch with our team today to explore land for sale in Grayson County, TX and the rest of North Texas.