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Today, Marcela joins us to answer some questions about land banking. While we experience investment clients, land banking differs since it’s an investment in raw, undeveloped land plots.
Land banking is the practice of buying affordable pre-developed land in the path of growth, unlike what we see typically in the Bay Area. Our land now is worth millions because of how much development is happening. However, if someone purchased this land before the development began, they could’ve gotten a bargain. Marcela’s company specifically specializes in this industry for that specific reason. She places investors in high growth areas.
Where exactly is this land? We’re looking at diverse areas with different socioeconomic trends. Particularly, Marcela concentrates on Southern California, a region with a lot of undeveloped land.
What are the benefits investors are seeing? Everyone has their own reasons for investing. Maybe it’s for retirement or college. Maybe it’s an alternative to being a landlord or maintaining a property. It’s an excellent opportunity to acquire wealth for the future. Plus, holding costs are low. The only holding here is the Property Taxes, no more than 1.3% of the purchase price. For instance, Marcela pays $400 a year in property taxes on her first investment land purchase, worth $70,000. Additionally, investors can create a self-directed IRA from their old 401k or IRAs. Companies can help you through this process to create a self-directed IRA.
What’s a typical investment? The minimum investment to get started is only $25,000, which is tremendously affordable to the average middle-class investor.
What service do you provide to help people get started? There are a few options here. You can set up an appointment to meet with Marcela in person. Additionally, her company hosts webinars once to twice a month to learn more about land banking.
If you have any questions about land banking or any other real estate topics, give us a call or email today!
