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  Acquiring land isn’t the most preferred investment for a lot of people. That’s because it’s not as liquid as other alternatives; it typically can’t be converted into cash within a short period. There’s also the perception that it takes a long while to achieve decent returns from it– and a lot of investors in these parts want to reap returns fairly quickly.
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But here’s the truth: there aren’t many assets that offer the sort of benefits that land does. While it might take at least a few years for it to turn in the sort of value appreciation that investors want, it often eventually beats the yields that a lot of other investment types produce. If you’re considering purchasing land or you’re just curious about it as an investment option, here are seven reasons why you should buy into it if you can.

Hedge Against Inflation

When prices across the board are rising persistently, the true value of the average person’s savings is depleted. Their money won’t buy as much as it used to in the past. That’ll mean that they are less well-off than they once were. Owning land can be a great way to protect one’s wealth against the erosive power of inflation. It’s one of the best stores of value available. You can raise its price to track general price increases and watch demand for it drive its market value even higher. If the land is in a location with rising demand, it can offer substantial protection against inflation.

High Return On Investment

If you purchase land in a fast-developing area, you can get a significant return on your investment in just a few years. Today, readily citable examples include the multiplication of the value of land in the Ibeju-Lekki axis of Lagos and the soaring prices of land in the newly developing corridors on the outskirts of Abuja. If you bought land in any of these areas just a few years ago, you could get a lot more than the price you purchased it for if you sold it now– in some cases more than 100%. That sort of return is unmatched by a majority of investment types.

The Possibility Of Further Development

There’s a lot that you can do with undeveloped land. The fact that it doesn’t have any property sited on it yet gives you the freedom to build whatever structure you want. It’s worth noting that developing property on your piece of land will increase its market value by a substantial amount. It could also make the land more attractive to potential buyers, depending on where it’s located. If your land doesn’t have a significantly developed property on it yet, you can construct something there that’s of a variety that is in high demand in that area.
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Perennial Demand

The demand for land across Nigeria continues to rise. This is especially true of the major urban areas, where the local populations have grown over the past few decades. All the signs point to an acceleration in this trend. The sustained demand for land means that you’re unlikely to struggle to find buyers for one. Again, this applies to cities and towns with expanding populations and the districts on the outskirts of these places. The swelling demand for land will push land prices upward, allowing landlords to sell them at much higher prices than they would have just a few years ago.

Low Maintenance Cost

If you’re investing in already developed property, you may have to spend a fair bit on maintaining it. This includes fixing damages and renovation costs. But this seldom applies to land. At most, you’ll be devoting resources to cutting down bushes, fencing the land, and putting up a gate. It’ll be up to you to decide what kinds of improvement to the land you want to make. Still, you won’t be devoting as much of your resources to getting these things done as you would if you had a property with facilities that you need to fix or renovate.

Multiple Uses

We have already noted that you can develop land for whatever uses you desire (as long as it’s legal and in line with the government’s plan for the area). You’ll have several possible uses to choose from. Many landlords prefer to build residential property on their land, and either sell or rent it out to buyers or tenants. They may do the same with commercial property. But they could also convert the land to a farm, and either uses it themselves or lease it to farmers. Finally, there’s the option of leaving the land just as it is until it can be sold for a decent price.

Less Expensive Than Developed Property

If you’re looking to invest in real estate and you don’t have a lot of money to do so, you should consider buying undeveloped land. On average, it’s less expensive than built property, and also allows you the freedom to construct your preferred type of structure (as we’ve already pointed out).

Final Words

There’s no better time to invest in the land than now. If you want to preserve and grow your wealth or enjoy the freedom of developing whatever property you wish to, owning your own land gives you a path to achieving these things. Featured Image Source: Housing
Got a suggestion? Contact us: editor@connectnigeria.com
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This article was first published on 30th March 2022

ikenna-nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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