Investing in real estate has become increasingly popular in recent years, with people looking to diversify their portfolios and find stable assets that can withstand economic downturns. One form of real estate investment that is often overlooked but offers a great deal of potential for investors is farmland.
According to savvy investors, farmland is the best long-term real estate investment there is. With the rising and unending global demand for food, farmland provides investors with the opportunity to invest in something tangible and secure, as well as the potential for long-term appreciation. Bill Gates amongst others falls in this class of savvy investors owning over 200,000 acres of farmland in the United States.
Farmland investment can be considered as part of a serious investment strategy for several reasons:
1. Farmland is a tangible asset that can provide a hedge against inflation, the value of farmland is closely tied to the price of food, which tends to increase with inflation.
2. Investing in farmland can provide a way to protect the purchasing power of your money over time.
3. Another reason to consider farmland as part of an investment strategy is its relatively low correlation with other asset classes, such as stocks and bonds. This means that farmland returns may not move in the same direction as other investments, which can help to diversify a portfolio and reduce overall risk.
4. Farmland has consistent cash flow from leasing the land to local farmers.
5. Farmland also can be considered a sustainable investment, as demand for food is expected to increase as the global population grows, and with the increasing trend of organics farming, yields and revenue tend to be more stable over time.
It is important to note that investing in farmland requires a significant amount of capital and an ability to analyze the market trends and land prices, also some knowledge of the agricultural market. It also might require hands-on management if one decides to actively farm the land.
Buying land for farmland investment can be a great way to diversify your portfolio and have steady, long-term returns. There are many different types of land available, including agricultural lands (which are used mainly for farming), nonagricultural lands (such as forestlands or grassy areas) and recreational lands (like lakefront properties).
Your decision will ultimately come down to the specific goals you have in mind and the amount of work or money you want to invest into developing the land. Depending on what type of agriculture you wish to carry out, some investors may even opt for purchasing industrial property if it is located close enough to sources that could help drive productivity up. Ultimately, it’s important to do your research ahead of time so you make an informed decision based on facts rather than speculation.
Common mistakes investors make when buying farmlands include not researching fully, overpaying for the land, failing to take environmental factors into consideration, and not hiring a trusted advisor. Hastom Food and Farm is a purpose-led agricultural and real estate company committed to making it easier for investors and farming enthusiasts to own farmland in Nigeria. Our company boasts its expertise in agricultural transformation in Nigeria, offering farmland investors a seamless farmland acquisition process.
This includes access to an experienced team with an unparalleled commitment to providing quality service, custom advice tailored to the needs of each client, access to arable and problem-free farmland opportunities across Nigeria that are rigorously inspected by experts before being offered for sale or lease. Furthermore, the team at Hastom also offer assistance throughout the entire process of ownership including legal paper work and documentation and even as far as facilitating setting up into a profitable agricultural venture such as cashew farming and absentee farm management.