Five Reasons Why Investing In Land Is a Smart Move In 2022
Five Reasons Why Investing In Land Is a Smart Move In 2022
2022 has seen a plethora of new investment opportunities that have taken the internet by storm.
2022 has seen a plethora of new investment opportunities that have taken the internet by storm.
NFTs, cryptos, digital real estate, and others became mainstream and valued at several million dollars.
While the investment scene seems to have accepted these new assets as “reasonable investments”, other types of assets, much older and much more conservative, have been left out by investors.
These assets are land, namely farmland and forest land.
Find below five reasons why land is such a great asset.
1. Diversification
Diversification helps investors decrease risks and expect better returns on their investment.
While many investors follow the trend and buy the latest stock featured in the media, this strategy may end up risky for their portfolio in the long term.
Obviously, nobody can predict the future, especially in the stock market.
By diversifying, you make sure that whatever happens, your portfolio will keep on going up.
2. It’s Easy to Understand
Stocks, bonds, and gold are investments that widely depend on the economic context.
To succeed, investors should study how the economy works, learn the basics of accounting, and have an understanding of human psychology.
It takes time, and it’s so complex that even the best investors are prone to mistakes.
One of the advantages of land is that it’s easy and straightforward to understand.
Its value increases because there is a finite supply and growing demand for it.
3. No Volatility
Most investors lose money in the stock market because the price of stocks is volatile.
When there is a crash, or when the value dives, several biases play. Investors become emotional and sell their stocks at a loss.
Such a thing is impossible with land, for two reasons.
First, the price of land is not quoted on the stock market.
Second, it’s not nearly as volatile as the stock market.
As a result, investing in land is great for those that don’t want to go through the emotional hardship of seeing their investments lose value.
4. Sustainable Investment
While great returns are important, many investors want to make sure that the impact their investments have on the planet is positive.
Land is one of the best ways to achieve such a purpose.
Investors investing in land invest directly in nature. The asset is taken care of by a farmer which makes sure the land is sustainably farmed.
5. It’s a Finite Asset
As the world population is growing, land will become more and more valuable due to its increasing use by humans and its finite amount.
These two characteristics make land one of the best long-term investments in the world.
A company can always go bankrupt.
Gold can always be replaced.
Governments can always default on their bonds.
But land will always be needed. And farmland will always be productive.
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