Investing in land is a quick way to become a real estate investor.
In fact, buying vacant land has some unique advantages and they include:
1. Buying vacant plots of land gives you an opportunity to buy property at low cost
2. Buying undeveloped plots of land makes it possible to convert your land investment into cash much faster in the future when you need cash
3. Undeveloped plots of land has potential to earn a much higher return on investment for you the real estate investor and
4. Buying land for investment purposes makes it possible for you to acquire properties without going through the rigours (and headache) of securing an investment property loan from a bank.
Investing in land gives every employee an opportunity to become a property owner at low cost.
Yes, you can become a proud owner of your own land even if you're a low income earner.
Simply take advantage of the land investment opportunities available to you on this retirement planning web site or any land investment opportunities in the country where you live.
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When investing in land, be aware that there are different types of property title documents available. And the title document a property has determines to a large extent what the price will be.
Why is that so?
It is pretty simple . . . investment plots of land with title document that is highly sought by land investors tend to sell for higher prices while vacant plots of land with least sought title document naturally sell for lower prices.
There are three types of land title documents that are available:
1. Certificate of Occupancy (C of O) issued by the state or federal government
2. Land gazette document issued by the state or federal government and
3. Deed of assignment issued by the indigenous owners of the land who have held the land since time immemorial
Plots of land with certificate of occupancy (c of o) issued by either the state or federal government are the most sought after by prospective land investors. Therefore, lands with C of O are more expensive than similar plots of land within the same neighbourhood.
In addition, banks only offer real estate investment loan to loan applicants who intend to buy properties that have C of O.
This means that no bank will agree to fund your property investment venture if the property does not have a valid c of o issued by the state or federal government.
Title Document #2: Government Land Gazette
In my part of the world, all land is owned by the state and federal government.
Therefore, to legally own a plot (or several plots of land), you must pay for and obtain a Certificate of Occupancy (c of o) from the state or federal government, depending on whether the property is within state or federal land. And the C of O is valid for 99 years. After which you have to go for renewal.
However, prior to when this became the law of the land, plots of land were legally owned by the indigenous people of the land who have had possession of the land from time immemorial.
The new law obviously created conflicts between the indigenous owners of the land and the government that used its powers to forcefully take over all lands in the country.
A settlement was eventually reached between the government and indigenous land owners and the settlement is this:
Large portions of ancestral land were carved out for indigenous peoples of each community to use for housing and farming purposes.
The portions carved out for each indigenous community was documented in a government gazette, which stated the coordinates of the land the government have released to the indigenous land owners of each community.
Each group of indigenous land owners could legally get their share of land from the government by applying for an excision from the government. And each excision request has an excision file and excision file number.
Consequently, a potential real estate investor can verify if a particular plot of land he or she wishes to buy have been excised by the government by asking for a copy of the gazette covering the excision (or the excision file number).
The indigeous people of a community with excised land, which is now free from the government acquisition status, can sell their land to whomever they wish.
When that sale transaction occurs, the indigenous people selling that piece of land will issue the land buyer a document called deed of assignment.
The deed of assignment document is a document that states that a portion of the community land with stated coordinates have been sold to the buyer whose name appears in the document. And that the stated purchase amount was received by the seller (or the family members representing the community doing the selling).
Why do we call the deed of assignment document a partially legal document?
We here refer to it as being partially legal because the document can be used to obtain a certificate of occupancy from the state or federal government if the land is truly free of government acquisition.
However, the document cannot be used to secure a mortgage loan from a bank.
Therefore, if you're thinking of investing in land through a mortgage loan, you must search for lands for sale with C of o.
In addition, if the government for one reason or the other re-acquires a section of the community land already excised to the host community for, say, a government development project or road expansion project, only land owners with certificate of occupancy (c of o) will be compensated by the government for taking over their land.
When investing in land, verify that the vacant plots of land you wish to buy is either covered by a government gazette (proving that it has been released to the indigenous people of the community) or that it is free from government acquisition.
A potential land investor seeking to buy undeveloped plots of land can verify if a land for sale is under government acquisition by visiting the surveyor general's office and conducting what is called a "property search" using the survey plan of the land he or she wishes to buy.
Remember . . . land investments are valuable investments that can generate income for you now and in the future after you're retired.
Therefore, when investing in land, be sure to verify that the land you're buying is free from government acquisition, especially if the land does not have a government issued certificate of occupancy.
If you mistakenly buy a land within the plots of land acquired by the government, you will ultimately lose your land investment as the government will someday come knocking with their caterpillars to demolish any property within areas covered by government acquisition.
Thinking of investing in land?
But ensure you invest wisely if you want your land investments to successfully fund your retirement life.
The above listed three title documents are the land title documents
available in Nigeria, West Africa. Check with your local real estate
consultant for the valid land title documents required in your country.
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