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The Solar Revolution

Solar is the one of the biggest land banking trends we’ve ever seen

 

Just look at the billions of dollars pouring into in the Antelope Valley as proof of that fact.

In five short years the Antelope Valley has already seen explosive growth in the solar industry, developing over 40,000 acres for energy production.

 

Big movers like:

  • Warren Buffet – invested over $2.5 Billion on 3,000 acres in LA and Kern County
  • The Google founders – have made 15 wind and solar investments totaling more than $1 billion
  • Christy Walton, Walmart heir and the richest woman in the world according to Forbes, owns First Solar, a 2,300 acre facility in Lancaster
  • Silverado – which merged with SPower in 2014 and now has over 4,000 acres of solar projects in Antelope Valley
  • And the list goes on…

Why so much activity when we’re still 6 years out from Assembly Bill 32’s 2020 deadline?

 

Energy companies don’t see a downside

Consolidators are quietly snatching up thousands of acres in the Antelope Valley because this is the perfect place for solar production.

  1. It’s close to the 2nd most populated city in the US. LA County just passed the 10 Million mark.
  2. LA has already invested Billions in the high-power transmission lines known as the ‘Blue veins of Gold’ to carry electricity into the city.
  3. The San Onofre nuclear power plant was taken off-line in 2011, decreasing energy supply.
  4. California is currently on-target to reach 33% renewable energy by 2020… but many are already looking at moving that all the way up to 100% in the next 30 – 40 years. In fact, Mayor Kevin Faulconer has already committed San Diego to reaching this impressive goal by 2035.
  5. LA has practically guaranteed solar operators they’ll buy every megawatt they produce. From an investor’s point of view this also guarantees returns, making capital easier to raise for more projects.

 

Investing nextdoor to Warren Buffett

In light of these facts, how would you like to be holding a 2.5 acre parcel near the strategic ‘Blue veins of gold’ (just like the one in the photo below)?

  • Slide for email

 

On this map you can see the following benefits:

This land is 1.5 miles from Antelope Valley Solar – That means you’ll enjoy a 20% increase in property value every time they make a capital investment through the power of the ‘unearned increment’.

It’s just .5 miles from a future 6 lane freeway (the E 220 Corridor). This $3.2 Billion super-freeway is going to be the main trucking and transportation route from LA. That means this property also has the potential of becoming warehousing space in the future.

It’s within 2 miles from existing power lines. Every solar plant needs to connect with the ‘blue lines of gold’. And 2 Miles isn’t so far when you consider that many of these solar facilities are over 1 mile in length, themselves.

Best of all, it has a very low entry price. This parcel sells for only $24, 500.

I have to ask: Where else can you buy enough land to build 11 full size houses for so little…or expect these kinds of returns?

 

The secret is out

With the International Energy Agency (IEA) sounding the horn on solar to the tune of $225 Billion per year, it’s not going to take people long to catch on.

In fact, the internet is already full of land-prospectors ready to offer you large plots of land at ridiculous prices. But I have to warn you – they’re not Land Bankers.

 

They haven’t followed the trend from the very beginning like we have.

They don’t do have our quality 16:10:3 due-diligence system.

Or offer the wide array of free after services that we do…

And I can guarantee they won’t have our 75% repeat investor rate, with over 23,000 clients served.

 

Your strategic advantage

Let me show you how you can use Velur’s investment system to retire better than you expected… live debt free… or pay for your children’s education…

Simply join us at my October 18th presentation to find out everything you need to know.

We’ll talk about the economic trends; solar, high-speed rail, the inland ports, housing, infrastructure, jobs and population growth. And you’ll have plenty of time to ask questions…

This is a no pressure situation. Just the facts – so you can make up your own mind.

Click – Here – to join us.

And make sure to bring your friends and family so they can learn how to profit from this historic change in the energy industry as well.

 

All the best,

Jenny's signature

 

 

Jenny Flynn

Owner of 9 parcels

Certified Velur representative since 2010

DRE#01895881

 

 

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California High-Speed Rail

We’ve all heard stories of how people got rich when the Continental railroad came through town. California high-speed rail

This is the perfect example of how land banking can work for you too.  Which is why many Velur investors with land along the high-speed rail corridor are so excited these days…

I’ve held off talking about this for some time because it’s been caught up in litigation.

But we’ve finally passed the #1 obstacle holding us back. On August 1st the San Jose Mercury Times announced that this historical project has finally gotten the green light. Reporting that:

  • The project will proceed unless challenged in the State Supreme court.  And the Plaintiffs haven’t indicated they would take that step.
  • Initial testing work is already starting in Fresno.
  • Jerry Brown has successfully tied $3/4B in annual taxes to CA’s biggest polluters to fund the project going forward.

As a Land Banker, you’re in a prime position to benefit from all of the economic activity this is about to create in the Antelope Valley…

For example:

  1. You’ll enjoy overnight gains of 10 – 30% through the power of the un-earned increment every time an infrastructure or commercial project happens within 1 – 3 miles of your property.
  2. A new transportation system is going to make it a lot easier for people to live in the Antelope Valley and work in LA, exploding the demand for affordable land for housing.
  3. That demand, backed by the economic surge of billions of dollars in new construction jobs in the area, will in-turn boost the value of local commercial and residential Real Estate markets.

And who stands to benefit the most from all this activity?

You.  The one who was smart enough to buy land at pre-development prices and hold onto it over the long hall.

Why? 

Because, as Warren Buffet explains, “Wealth is the transfer of money from the impatient to the patient.”

Velur investors know this very well.

This is how we are planning to pay for our children’s or grandchildren’s college educations… to have a better than expected retirement and live debt free… and why 75% of Velur investors – over 34 years – have purchased more than 1 property to enhance their portfolios.

If you haven’t invested yet, or you’ve invested and you’d like to see how these developments impact your properties, send me a mail – Here –

We can schedule a webinar at your convenience to go over the most up-to-date information. And I promise, with Velur’s years of experience, 16:10:3 due diligence system and policy of ‘putting our money where our mouth is’ on every single property in our inventory, I can show you the best parcels of land along this project, with the greatest potential for returns.

Now that we know this project is speeding forward – you have the chance to make great financial gains right along with it.  But this kind of historical opportunity won’t last long.  Get in touch with me today and find out how high-speed rail can change your future for the better.

Looking forward to hearing from you.

 

Sincerely,

Jenny Flynn

Owner of 9 parcels

 

P.S. See the latest high-speed rail videos to fully understand the financial impact this is going to have through-out the State.
Video 1
While this first video is a Fresno-specific view of High-speed rail, it gives you a great picture of the boost this is going to bring to their local economy.

 

Video 2
This shows you how High-speed rail is going to change the vision of transportation in California.

 

Video 3
This is a fly-over from Palmdale to Burbank Airport.  In it, you can see how High-speed rail is going to become the main-line artery between LA, Burbank Airport, the Dogger’s Stadium and the Antelope Valley, linking commuters to their jobs downtown in one easy stop.

 

P.P.S  And check out the new Anaheim station connection the local and regional buses, Metrolink, Amtrak trains and the future High-Speed Rail lines.  Read more – Here –

California rail

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What’s the right retirement age?

What if, on your 65th birthday, you pulled up your bank statement and saw you’d finally reached your milestone goal of setting $1Million aside for retirement.  With that and your monthly social security check, are you really in a good spot for retirement?

Is it time to:

  • Start planning for the vacations you’ve always wanted to take?
  • Take up new hobbies with your spouse?
  • Or dine out more often?

That all depends on one question

And that is: Is this really enough of a cushion for you and your spouse to enjoy for the rest of your lives together?..  Because that’s the ultimate goal, isn’t it?

 

Unfortunately, even with a million dollars in the bank, that breaks down to just $25,000 each for the next 20 years, or $138 a day – total.

You can spend that much on a simple trip to the mall.

Yes, the extra $86 from Social Security helps – assuming that the program survives another election…

But, when you look at all the medical expenses that go along with growing older, it’s easy to see that $224 a day only covers the essentials.  What about everything you’re dreaming of?

How do you have enough money for retirement?

That’s why it’s not enough to set money aside for when you retire.  Because even if you retire as a millionaire, you don’t want to have to live just north of the poverty line for the rest of your life.

That’s why ‘making your money work for you’ is the only reasonable way to plan for your future.

And that requires action – putting your money into action for you.

 

In my 4 ½ years as a MET LIFE financial planner, I’ve advised hundreds of families on how to set up their finances for a successful retirement.

I show them that, “while you’re celebrating your 70th birthday, your money should be doing something to make sure you can afford the next big family vacation when you turn 75.

And while you’re on that trip, your investments should already be growing in value so you can continue to enjoy your life in the future.”

 

That means setting up an income stream with enough profitability.

Something that allows you to:

1. Live comfortably, and

2. Have the capital you need so you can re-invest to keep the process going.

My personal success story

Land Banking is the only kind of investment I’ve found which promises that.  And that’s probably why Velur has had a 75% re-investor rate over the last 34 years.

Here are a few examples of how it’s helped me plan for my future:

  • My Perris, CA property – Which I bought for $170,000 in 2011 is now worth about $1,000,000 based on an offer another Velur investor received this year.

 

  • My property in Palmdale – Bought in April 2013 for $130,000 for 1.25 acres  – Currently there is a listing less than .5 miles away for $235,000 per acre.

 

  • My residential property in Lancaster – I bought this in 2009 for $85,000, and it’s now worth about $280,000 minimum.

 

  • My agricultural zoned property near Ave. K – Purchased in 2013 for $12,400 per acre. A new solar facilities have moved in close to this property and offers, per acre, start at about $15,000

 

  • My heavy Industrial zoned property on Ave F near 4th St E – Bought for $40,000 per acre in 2011  – Build Your Dreams (China’s largest company) opened the EV Bus Manufacturing facility 1.5 miles away. In Sept. of 2013, the city of Lancaster paid $2.67 per square foot for 12 acres of land for future expansion of BYD. I paid $0.92 per sq foot. That’s a difference of $76,230!

 

My total investment so far? $437,400.

Now, I’ve had partners on many of these deals so I can’t claim all of that capital as my own.

But even if it was, you have to realize it would only be enough to give me $60 a day for the next 20 years… not quite the lifestyle I envision…

(And since I’m planning on retiring at 57, I’d probably have to stretch that out for the next 30 years)

 

Instead, with Land Banking, I’ve been able to grow my capital into $1,646,230 worth of solid real estate value!

And the best part?

Because I own property in the direct path of growth, time becomes my biggest asset – instead of my biggest threat.

As I grow older my assets continue to mature.  And that lets me sell one… take half for a nice vacation… cover my bills… then re-invest the other half and start it all over again.

That’s how you can get your money working for you – instead of just working for your money.

Your future

It’s not enough to know you need to have money to retire, you have to have something in place that is going to help you grow your money in the future.

However you plan to do that, I’m here to talk… to share my experience as a retirement planner and learn about your dreams for the future.

After all, your retirement should set you free.  Your retirement age is simply the time and date that you figure out how to make that dream a reality.

 

Sincerely,

 

Jenny Flynn

Owner of 9 parcels

DRE#01895881

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How can I use my 401(k) for retirement?

This is a question I get all the time.

And my response is always the same.

You should really be asking: How can I use my 401(k) for a better retirement?

 

In fact, whether you’re talking about investing your Roth IRA or using your savings, ‘better’ means investing in areas that have:

1. a lot of growth potential and,

2. a lot of supporting factors that all come together to support the value of your investment.

 

If you’ve seen my presentation, you already know that Velur’s due diligence system guarantees that all of our properties are in an area with:

  • A large urban population (LA just passed the 10 Million mark)
  • Inexpensive housing (Lancaster and Palmdale are half the price of buying in LA)
  • And a diverse job base.

That last point is the one I’d really like to focus on today.

 

As a Land Banker I am constantly following the developments in the Antelope Valley.

I’ve been delighted by how the solar revolution has raised the value of my properties and by how this technology has made the world a much nicer, cleaner place to live.

Tesla Motor’s surprise announcement this week promises to do the same.

But before I go into that, let me show the tragic beginnings of this story so you can understand why this is all happing now and what it means to the future of land banking in the Antelope Valley.

 

Generous to a fault?

If you know Nikola Tesla’s story I’m sure you’ll admit he was ahead of his time… he invented hundreds of electrical instruments and devices, promising the world huge breakthroughs in areas such as communication and energy.

These innovations, he said, would result in a virtually unlimited supply of virtually free energy for everyone… delivered to your home even without the need for wires!

Imagine how that would have changed the world.

Unfortunately, even though his scientific method was sound, many were skeptical.

And when J.P. Morgan and other financial backers found out that Tesla’s focus wasn’t really on profit… that he was only in it for the betterment of humanity, itself – that skepticism quickly turned into disbelief.

Without that clear money motivation his investors ultimately abandoned him and Tesla’s promise of a bright future slowly and surely unraveled.

 

Until this week

Staying true to Tesla’s spirit, Tesla Motors shook the foundations of the automotive industry recently by announcing it will open-source all its patents, in addition to potentially allowing other automotive companies use of the company’s proprietary Supercharger network.

 

Here’s how this is going to change the world…

What do you think this news means if you’re sitting on the board of General Motors today… or any other car manufacturer around the world?

I think you’ll agree, electric vehicles just got a lot more interesting.

Not only does this move drastically slash their research costs but it also provides their cars with the multi-million dollar infrastructure needed to make consumers see them as a better option for the environment… and one that’s just as convenient as any other gas guzzler out there…

Backed by the California ZEV emissions law which say that by 2025 all car manufactures must have an electric line… these open source patents create an entirely new level of competition in the electric vehicle market… on a world-wide scale.

I believe this exactly what Nikola Tesla would have wanted.

No longer can his technologies be controlled by a small group of investors, a board of directors or even have its fate tied to the success or failure of a single company…

Now, the genie is out of the bottle and with it we are about to see the world change it’s opinion on transportation and energy for the future.

Which brings us to speculate on the location of Tesla motor’s soon to be announced Gigafactory.

As you may know, California is doing everything it can, even changing the tax code to get on the short list.

 

And it’s working…

Among the 5 possible choices Lancaster is now considered as an exceptional prospect.

They have:

  • The world’s largest solar facility. Add Warren Buffett’s recent promise of an additional $15 Billion on top of what he’s already invested and Tesla Motors knows they’ll have all the power they’ll ever need for production.
  • A great distribution network. As the inland ports continue to develop in Lancaster and Palmdale, the Antelope valley is quickly transforming into the undisputed transportation hub of California. (Aided, again, by Mr. Buffett. Remember, he just purchased the Burlington Northern Santa Fe Railway in 2013 for $44 B, effectively connecting the Antelope Valley to the rest of the US.)
  • The massive market demand. With Los Angeles’ population just passing the 10 Million mark. Along with the popular demand to reduce greenhouse gasses… and LA’s infamous smog… Tesla’s Gigafactory is exactly what people need for a cleaner environment.

But even if Lancaster isn’t the first Gigafactory?… So what.

By releasing the patents for their technology out into the general public, Tesla motors is virtually guaranteeing their design becomes the standard for electric cars going forward.

So even if it doesn’t happen this year… we still know that the demand for a better, cleaner transportation system is going to be there in California next year and the next…

And that creates a huge incentive for any car manufacturer.

So it’s not hard to see that with these new open-source patents, and Lancaster’s generous tax breaks of nearly $46,000 per newly hired factory employee, companies from all over the world are going to start setting up shop in the Antelope Valley very soon.

 

Just following the trend…

After all, this is where Kinkysharyo recently opened its $60M dollar light passenger train facility. And this is where Build Your Dreams (the largest company in China) just rolled out their first 200 mile-range electric bus a few months ago.

Stories like this are happening every day.

Which is beautiful news.

Not only have these developments given me 9 positions in an environment of ever increasing housing, commercial and solar construction, they also provide us with hope for a better future… a better environment… and more jobs.

 

As Tesla predicted…

In his own words, “… All that was great in the past was ridiculed, condemned, combatted, suppressed – only to emerge all the more powerfully, all the more triumphantly from the struggle.”

We’ve finally discovered a way to make a profit from our renewable resources… while reducing our footprint on the environment.

That’s the missing piece. And now that we have it, we’re going to change the world.

It’s time for us to embrace Tesla’s spirit of innovation as our own.

 

Solar is the new oil…

And now… combined with Tesla Motors’ spirit of generosity… I believe we’re about to witness the birth of a whole new generation of green automotive companies in the Antelope Valley. This is the start of something big.

It can also be your path to a better retirement.

I am still able to get 1.25 acre parcels between Warren Buffett’s solar facility and the “blue lines of gold” high power transmission lines.

And if you act fast, I’m confident I’ll be able to place you on the doorstep of Tesla Motor’s Gigafactory, when it’s announced, as well.

So whether you’re thinking of using your 401(k), Roth IRA or savings account, make sure you position yourself in area of predictable growth… in today’s economy… and in the future.

Get in touch with me today and take advantage of my numerous years as a retirement planning professional and see how you can have a ‘better than expected’ view on your future as well.

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Debunking the Myths about Land Banking, Part 3: I’m Too Young to Invest in Real Estate in California

In the last post of this series, we explained why you don’t have to be a developer to invest in real estate in California. Today, we’ll debunk a more serious and somewhat related myth: some people are just too young to invest in real estate.
First, let’s look at some of the reasons people think young people can’t invest in real estate in California.

• The cost is prohibitive.
People often think young people might be able to make other, non-real estate investments more easily because they are less costly. The opposite is true. In reality, even working college students with a few thousand dollars in cash on hand can invest in land. Why not invest in the stock market instead? Doesn’t it seem less expensive? Think again – creating a well-diversified portfolio takes resources, and a good stock market investor holds many different kinds of stocks.

• Young people can’t make responsible choices about illiquid assets.
Some advisors steer young people away from land because they thing young people don’t know what they’re doing and will make the wrong choices. To us, this just seems a silly. Young people are often more cautious with their money than established investors are, and in our experience, they are the hardest workers when it comes to researching their purchases and consulting with all the advisors they can find.
Perhaps young people are advised against buying land because investment advisors think that they will lack patience, wanting to sell the asset too soon. Here again, they are wrong; young people are more patient, as they have more time to watch their assets appreciate.

• Young people should be investing in high-risk, high-return products.
The idea that young people should never invest conservatively comes from the perception that all young investors are wealthy businesspeople or children of dynastic wealth. In fact, plenty of middle-class young people are eager to start saving for retirement and their children’s education, and these are not investors who have nothing to lose. The best investment portfolio for a young family includes at least one long-term, illiquid investment.

We’ve shown the mistaken logic behind the reasons people think young people should not invest in real estate in California. But are there good reasons to think young people should invest in real estate?

Young people are ideal land bankers. In California, land banking can yield profits over 20, 30, and 40 years, and the longer an investor can wait, the higher the profit is likely to be. Young people can wait. Further, land banking is an ideal low-risk and low maintenance investment for a young family or a young professional who travels often. Unlike other types of real estate investing, it’s easy to continue to hold a job while being a land banker – as most of us have learned, the same isn’t true for people who manage residential property.  In the end, it’s never too early – and a person is never too young – to plan ahead.

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California’s land in the path of development: some distinguishing features

When you consult with us and we show you land parcels, we’ll be showing you hand-picked pieces of California that we consider to be in the path of development. We’re invested in the very same areas, and we’ve gotten to know the land in Los Angeles County such that if it’s in the path of development, we think we can tell. So, what characterizes land in the path of development in California? Here are a few of the parameters we use to determine that.

• The natural features of the land are appropriate for development.
Before we consider a parcel, we look at its topography and the accessibility of water. Is the land flat and dry enough for developers to build on it? Is the water supply nearby? If not, is it easy to irrigate the land, not just in times of plenty but in times of water scarcity as well? Although Los Angeles County is near a port, freshwater can be difficult to find. Access to freshwater is a foremost consideration before we make any purchase.

• It is easy to expand into the land.
Although roads, electricity supply centers and other essential utilities may not be available, there needs to be a feasible way to build them. To understand whether it is possible to expand into the land, we consider the land itself, surrounding areas, and nonmaterial aspects such as government regulations, natural resources, and animal and plant life.

• An urban center is nearby.
Our choice of land banking in California made this part simple. Land in the path of development in California (or anywhere else) must be near a metropolis, so we chose Los Angeles County. One of the most important cities to the U.S. economy (and the most important in California), Los Angeles is still growing to accommodate technological progress as well as population expansion.

• Commercial and residential development is happening on the edges of the surrounding suburbs.
A seemingly insignificant area of land quickly becomes important when the cities and towns that surround it begin to expand. Before we recommend real estate to clients, we research what’s happening in the suburbs that surround it. If industries are moving outward, schools are building new campuses, and individual residents are building houses, that land is in the path of Los Angeles development.

• The information comes from a trustworthy source.
How do we do our research? Physical research is done in person or by our speculators. For other aspects of our land banking research, we consult city governments to ask about community plans that may be in place. We get as much information as we can from industry leaders in energy and transportation, but we also consult smaller businesses to discover their expansion plans.
These five criteria help us determine whether a piece of California land is in the path of development. Only after satisfying them do we recommend parcels to our partners, clients, and fellow investors.

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I’m a young person. What should I invest in?

You’ve just landed a great job and paid off your student loans. Maybe you’ve started contributing to your 401(k). Young people are ideal investors, because they usually don’t have families to support, and they have many years during which their investments will have time to grow. How should young people make the most of their investment opportunities?

Many young people are attracted to the stock and bond market. High-risk, high-return products appeal to those with time to spend on them. We’re not here to discourage young investors from trading Wall Street products; be smart about it, and you’re likely to do well. However, many young investors, especially those who work in banking, are already wary of the market. After all, they were in school when the financial system ceased to function.

Others are interested in entrepreneurial ventures and startups, which are also high-risk, high-return products. When lending to startup founders, however, remember that the rate of startup success – those who survive for more than three years – lingers around 20%. Gloomier yet, the group of startups that IPO is just a small fraction of the total pool. However, if you have a passion for entrepreneurship, now is the time to enjoy it.

A smaller number of young investors seriously consider purchasing land. This puzzles us, as young people make perfect land bankers for two reasons:

First, young people have time. In land banking, the most impressive gains happen for people who give their properties time. Young people with at least 40 years until retirement can profit immensely from land, because land in the path of development is priced differently depending on how soon it will be developed. More expensive parcels are 5 or 10 years away from development; cheaper ones are further away. Young people who buy land parcels and wait for them to be developed can see 300% and 400% returns on their investments.

Second, the most profitable land developments will take two or three decades to come to fruition. In California in particular, interest in alternative energy (solar, biofuel, and wind) is growing. All of these solutions require large tracts of land, and building them into sustainable businesses takes time. Young people who invest in land to be used for solar or wind farming today will benefit the most from land banking.

Finally, land banking is a low-maintenance, low-stress way for young people to begin saving for… whatever they need to save for. Though retirement is far away, investing in land now will make it easy to retire in the future. When they do choose to start families, young people who are invested in land will have a stable, illiquid asset that can serve as a source of funding for their children’s college educations.

As a young person, it’s natural to be drawn to risky investments that promise instant gratification. But before you build your portfolio exclusively from stock and bond investments, consider the benefit of a stable, safe investment for the long term. Diversify through land banking. For more information, please contact us!

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A Little About Us: Why We Chose to Invest in Land in California

When people ask us why we invest in land in California, we split our answer into two parts: first, why we invest in land in California, and second, why we invest in land in general.

If you’re going to invest in land, California is the clearest and best option.

Firstly, the population growth in California is immense. 1 out of every 17 Americans live within a 60-mile radius of Los Angeles, and that number is growing. People will have to push out of the urban centers and move into less developed land: places that are two or three hours away from the most populous areas. This is where we’ve invested.

Secondly, California is a center for innovation, especially sustainable energy innovation. Recently, interest in solar energy has grown all around the country, and individual investors as well as organizations are building solar farms in southern California, where the land and climate is ideal.

Thirdly, real estate prices in California are relatively low at this time. The rule of the real estate market is no different from any other market: buy low, and sell high. When we saw prices drop, we knew we needed to invest here.

Fourthly, California, particularly southern California, has a historically resilient economy. Even when the economies of other states are suffering business and commerce flourishes in California, and employment is high. A resilient economy makes for a resilient land investment – the stronger the economy, the more developers will be interested in the area.

As you can see, it makes sense to invest in land in California. But what about the career choice in general?

Land banking is a lifestyle choice. It’s a different way to make money that doesn’t involve a corporate job during weekdays and business hours. In one sense, we work more than many people do – we’re constantly marketing by word of mouth, brainstorming new ideas together, maintaining our land, and researching other land investments. But in another sense, the sense of “work” goes away, and we’re left with a productive job we enjoy and learn from.

Land banking has freed both of us to pursue other goals in life, including funding a foster home in Vietnam. Working on these other projects is rewarding, and we see the benefit that comes from smart investing. The investment itself benefits us; we have financial security and peace of mind to last for many years.

Both of us have tried investing in other kinds of real estate, and we have owned rental properties. We both had bad experiences with tenants, regulations, and unanticipated costs. Even with a property manager, the upkeep of a rental property investment was overwhelming. Land banking frees us from that strain.

The best part about working in land banking, however, is meeting other land bankers (especially new ones). It’s interesting to hear other people’s stories and learn how they got interested in land; it’s also eye opening to work with new people with different perspectives. We are experts in what we do, but our customers and associates teach us things we wouldn’t have learned otherwise.

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Beginner tips for Land Banking in California

Land banking can be an ideal investment strategy, but if you don’t know what you’re doing, you might learn Land Investment 101 the hard way. Here are a few simple, ground-level tips to make sure your investment is a good one.

1. Understand taxes.

It’s a good idea to learn as much as you can about the tax systems in your purchasing region. Figure out whether you can afford the yearly property taxes. Some properties have prohibitively high tax rates, while others, especially land banking investments, are more reasonable. Expect different tax rates for different properties: a 10-acre parcel in a 15-year development path will have a more manageable total property tax burden than a 10-acre parcel at the heart of a metropolis. You may need to narrow down your options depending on the taxes you’re willing and able to pay each year.

Some states’ property tax laws tax land being used for agricultural purposes at a much lower rate. As you wait for your investment to appreciate, see if you can qualify for this reduction by growing something on your land.

2. Cash can help.

Today, it is difficult to obtain financing, especially for land. This is because raw land doesn’t produce sufficient cash flow to satisfy a mortgage payment. When investing, it’s best to come to the table with some cash or transferable funding on hand.

3. Location, location, location.

This is the theme of our site and our business, but it never hurts to repeat it. The location of your land parcel will determine your investment success. Location also determines the speed of turnover. A (usually higher-priced) parcel closer to the urban center or source of development will appreciate sooner, and you’ll be able to sell it in a shorter time. A parcel further down the path of development is a longer-term investment. Consider location and all the factors associated with it when you purchase land.

4. There is no instant gratification.

All good investments take time, so be patient: wealth doesn’t happen overnight. In today’s world of instant responses and lightning-fast connections, don’t panic when the market has a few lows, and don’t get too excited over a high. Be willing to wait it out; a long-term land investment will yield the greatest rewards.

5.  Protect the land.

After you purchase your land, it’s important to keep liability low. Though land requires less maintenance than other real estate investments, it needs some care. Here’s how:

•    Prevent people from thinking your land is a vacant lot. Put up “private property,” “no hunting,” and “no trespassing” signs.
•    You will probably live a fair distance away from your land. Get an advocate to watch the property, checking in on it once in a while, and befriend the local authorities. A small manager’s fee to make sure that someone walks by the property once in a while can save you a lot of grief later.
•    Mow and maintain the land, especially if there are wetlands nearby, to prevent wetland encroachment and maintain curb appeal.

If you follow these simple guidelines, you’ll have a more pleasant and rewarding land investment experience.

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Why Housing isn’t a Good Investment, but Land Is

You’ve probably read enough about investing to know that when your friend says, “I just bought a Lexus; I think it’s a great investment,” you can laugh. Although people constantly talk about their cars as “investments,” from an investment perspective, it’s much better to hold cash in a bank than buy a Lexus. Cars depreciate, and it’s almost impossible to sell a car for a higher price than the price you bought it for.

Houses are similar. Although it is possible to profit off of the sale of a house, houses are relatively durable products that still depreciate over time. Renovating and redecorating might make you money in the short term, but in the long term, a house isn’t a good investment.

That’s not to say that residential property can’t be a good investment under any circumstances. Of course, if you buy residential property with the intention to lend it out and collect rent, you can profit immensely. However, whenever you decide to sell that building to someone else, you’ll likely get it for the same price you bought it for. Consider the housing bubble. At its heart was the belief that a house is an investment – that it will never lose value, and at worst, it will remain the same. This fallacious logic resulted in a nationwide crisis. If individuals had focused on the value of land, however, rather than the value of housing, they may have fared much better.

Land is a good investment because it does not depreciate. At worst, land keeps up with inflation, retaining the same objective value over time. But land does not only maintain its value; it gains value.

Some finance and economics gurus claim that land, especially in America, does not gain objective value. It keeps up with inflation, and because America has so much land, there’s not enough scarcity to make it desirable. However, the reality refutes this argument. It’s easy to see that expansions of Metro systems, for example, make land around urban centers more desirable. This happens time and time again throughout history. It’s difficult to imagine how it could be any other way.

In response to the argument that land in America is not in short supply, we need to put things in perspective. It’s true that millions of acres of land in America go untouched and are in generous supply. However, much of that land is isolated from urban centers or has no access to water and other essential resources. In reality, land with desirable qualities (e.g. ideal topography, promising location, proximity to resources) is in short supply. For this reason, land can gain value astonishingly, and many landowners have sold their parcels at five, ten or twenty times the original price.

If you plan to rent it out, a residential building might be a good way to make money. However, housing is not a long-term investment. Land is a stable long-term asset with potential for growth. For more information about buying land for investment, contact us today!

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