From the video:
While often overlooked, there are many ways to make money with land in Colorado! Get some ideas and learn about what to look for in our latest post!
When investing in Colorado, there are a few things you can do to help you make money with land.
Flipping land is a niche that investors don’t always take advantage of. Land can often be acquired at a low price and resold much higher when the right buyer is found. When you find a motivated seller, the deal can get even sweeter.
Getting started with land can be much easier than investing in residential real estate. There are no maintenance costs, and the holding costs are minimal. Your holding costs are essentially just the annual property taxes and the HOA dues (if the property is in an HOA).
And property taxes in Colorado are affordable. You can get a rough estimation of the annual property taxes by using websites like http://www.tax-rates.org/colorado/property-tax. The first thing you’ll see is this map. The red hues are higher numbers, higher taxes.
This data includes all property taxes. If you’re only looking at vacant land, you can expect it to be less than the average value for that county. If you’re looking at a house or commercial, it might be more than the average tax value.
You can use the map to find different counties that you’re interested in investing in, or you can scroll down the page here to see the average values listed out by county.
Even if you can’t find a buyer immediately, you won’t be losing too much by having the property sit in your portfolio, as property taxes for vacant land aren’t normally more than a couple of hundred dollars a year (don’t forget larger properties will have more tax than smaller ones).
Rent It Out
Just like a house, you can rent out your land too. First, you’ll want to make sure the land is zoned for what they plan on using it for. You don’t want any penalties for misusing the land to come back to you.
Depending on the location and size of your land, a few people who would be interested in renting your land include:
Farmers – Farmers can use your property for crops or livestock as zoning allows. If you own a larger parcel in a somewhat agricultural area, reaching out to area farmers to rent your land isn’t a bad idea. There are over 38,000 farms in Colorado, equating to more than 31.8 million acres! Depending on the type of land you have and if there are trees on it, this could be a great option for you.
Local Businesses – If the property is zoned for it, you can lease the property to a local business to use for parking, seating, or for a special event.
Recreational Uses – League sports, BMX, or archery ranges are just a few examples of recreational businesses that will seek out the use of land. It may not be economical for them to purchase the land outright, but being able to use your land can help everyone. Of course, you’ll need to make sure the right permits and insurance coverage are put into place.
Special Events – A flea market, a farmer’s market, a craft fair, or even someone’s wedding are just a few of the ways to use the land. You’ll need to be sure the proper permits are in place and that you are working with reputable event organizers.
As a landowner, you’ll want to keep your eye on development costs. Don’t be afraid to price things out and get some estimates. If you can find a cost-effective way to develop the land yourself, you may be able to make a lot of money renting or on the resell.
Sell It Directly
If your goal is to sell the land for a great price, find out what local buyers, developers, and builders are currently paying for land. When you sell the land directly as opposed to hiring an agent, you won’t have to worry about paying any commissions or fees. The goal is to buy low, then look for those actively buying, selling the land quickly and for a profit.
If you own land that isn’t costing you much, it might make sense to simply hold onto it and wait. Maybe it is in a more rural or less desired area. Communities are changing all the time. Land that was once worth only a few thousand dollars can quickly become land worth tens of thousands of dollars. Keep your eye on the market and sell when the time is right.
We can help you with your land search in Colorado! Get in touch with us today for more information! (313) 349-0434
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