Value of Land Banking

15 Jan Value of Land Banking

While it could be said that most people picture a standard home and property when thinking about real estate investing, another increasingly valuable asset is making it’s way into the world of mainstream real estate investing: Land Banking. Similar to buying and holding, land banking involves the purchasing of an asset and holding on to it for future appreciation, except for the fact that this is vacant land that has yet to be developed. Now, rather than blank lots taking away from the overall beauty of the neighborhood, the potential of these assets is being brought out as investors look to them as a means to added profit.

Here is how land banking works. A public authority, called a land bank, obtain these vacant and sometimes abandoned properties, and open the way for them to be developed. Any obstructions for future development are eliminated, and these properties are then sold as assets to real estate investors. Giving way to added development in the community and creating yet another niche in the real estate industry, land banking is proving to be a popular and increasingly growing area of investment to work in.

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