Are you holding on to land in Farmington MI? Instead of just letting it sit there, you might want to consider what it is really doing to help you! We buy houses in Farmington MI and we can help you explore the pros and cons so you can decide if selling is the right choice for your situation!
Pros and Cons of Holding On To Land in Farmington MI
Pros of Holding On To Land in Farmington MI:
Low Purchasing Costs
It can be pretty simple to acquire your first land investment. You can get started for only a few thousand dollars, buying land low and selling high!
It May Increase In Value
There is a chance the value of your land could go up. However, this can be tough to predict and impossible to guarantee. Always keep yourself on the pulse of what is going on where you live. Don’t be one of those absentee owners who don’t keep up with what’s going on. Capitalize when you can on anything going on in your area that can increase the value of your land!
Land typically requires little to no maintenance to own. You don’t have to worry about making repairs, dealing with bad tenants or utility costs. Your property taxes will be considerably lower and are usually one of the only expenses you will face.
Cons of Holding On To land in Farmington Michigan:
It Might Decrease In Value
Land doesn’t always rise in value. If a neighborhood cools off, there can be considerably less demand for the property. This all comes down to your timing, but don’t expect land to necessarily increase, especially not right away.
Not Producing Income
If your land isn’t producing an income for you, you should ask yourself why you are holding on to it. If you think you might “build on the land one day” but don’t have any concrete plans put together, the taxes you are paying might not be worth it. You might be better served by selling the land now, and buying land when you are ready to build. Who knows what can change before then!
It can be difficult to obtain a zoning change if that is what you are intending to do. You might experience backlash from neighbors or find yourself buried in red-tape in order to make it a reality. If you own a large parcel of land, you may not be able to subdivide it in the manner you would like.
Endangered animals or other environmental protections can limit your ability to develop a piece of land. Even if these animals aren’t currently present on your land, it’s not to say a bald eagle won’t come to make a nest on your lot, prohibiting all building to take place. Of course this doesn’t happen every day, however, if you live in an area where there are many protected species, don’t be surprised when one takes up residence on your inviting, vacant lot.
Miss Out On Other Investments
One of the biggest cons of having your money tied up in land is the chance you will miss out on a much better investment. Sure, you can make money from land. However, it can be more difficult to liquidate quickly should something come up making you want to sell. There are excellent, profitable investments out there, and if your cash isn’t available when needed, you might miss out on a lucrative opportunity!
Farmington MI Home Buyers
When investing in Farmington MI land, make sure yo have an exit strategy in place. Make it a point to become acquainted with the area’s top buyers and strive to keep your finger on the pulse of the local real estate market. You don’t want to find yourself stuck with a worthless piece of land and nobody to buy it.