We all consider buying land at one point in life. This thought crosses our minds because we either think it’s a low-risk investment, we can purchase the land for selling at a later time, or buying the land for development.
While all these are valid reasons for purchasing land, there are key questions that one needs to find answers to, before making that ultimate move, which will see them acquire that piece of land they so desire to have. Lack of answers to these questions has led many to make purchases on non-existent properties and sometimes feeling like they made wrong investments.
We take you through the five most important questions you need to ask yourself before making that investment in land.
Are you ready to make the investment?
This is one question that should be answered before the process of finding that piece of land begins. One needs to know if they can afford to make the buy, and if not, at least have a plan of how they can raise the required amount for the piece of property they want to acquire.
There are many ways you can go about this; use your savings, take a bank loan, or have a payment plan after agreeing with the owner of the land.
Are you ready for the risk involved?
Another question that needs to be answered is if you are ready for the risk involved in buying land. For instance, one might purchase the land and hope to resell it after sometime at a higher price, but when the time for the resell comes, they will not be able to sell the property. You need to be prepared for such an eventuality, and what will happen in case things don’t go according to their initial plan.
Who is the real owner?
After you have settled on the piece of land that impresses you, one of the questions you need to ask yourself is who the real owner of that piece of land is, and if they have the title deed for the land. This can be done by asking for a copy of the title deed from the owner and doing a search at the Ministry of Lands to ascertain that the land really exists.
Is it in the ideal location?
The location of a piece of land is another very critical question, depending on the particular purpose you want to use the land for. One cannot buy land at a place where there is no good road access when they want to use it for commercial purposes.
Do you have an exit strategy?
When investing in real estate, one needs to have a plan on what to do if the initial plan backfires after buying that piece of land. All businesses have risks and it’s important to have an exit strategy because it helps you cover all the eventualities that might befall your investment.