How to invest in land to make a profit, before deciding to put money down, you should know these things

07/05/2022 08:52 GMT+7

Data from the Ministry of Construction shows that the number of land land transactions in the first 3 months of 2022 reached 153,537 successful transactions. The total transaction volume was about 242% compared to the fourth quarter of 2021. Specifically, in the North, there were 20,726 transactions; in the Central region there were 42,722 transactions and in the South there were 90,089 transactions. This figure shows that, compared to other real estate segments, land plots are always the segment chosen by many investors.

Commenting on the real estate investment channel, Mr. Pham Thanh Hung, Vice Chairman of Cengroup, said that this is a special type of investment because of its small value. However, land plots are the “tail” of the investment wave, which means that when the land “fevers” up, the real estate market has begun to reach saturation.

Many people choose land as an investment channel, sheltering assets with the expectation of good profitability, so this segment is always strongly attractive to investment capital.

According to Mr. Hung’s analysis, like securities, when all people invest in securities, from the woman selling vegetables to the students, they also talk about investing in the stock market, which means that the market is having problems. The same goes for ground land, especially in the provinces.

Mr. Hung said that land is a long-term investment product and usually goes through a few cycles of price appreciation. Therefore, when investing in land, investors need to consider and consider many factors.

In case the land is in the state-owned sector, which has been auctioned, built infrastructure and then sold for self-construction, or the land is located in established urban areas, it will be classified as a very good potential group. On the contrary, if the land is located in a remote area and the infrastructure has not yet arrived, investors need to be careful.

“Need to know the use value of the land if you want to invest sustainably. For example, land only plays the role of a turn-key investment product, the latter selling a little higher than the former, those products need to be careful. Maybe we can’t withdraw capital in time and need to wait for a few more cycles, or investors will become residents,” Mr. Hung noted.

Land plot is a ‘delicious dish’ but it is not easy to choose, Mr. Dinh Minh Tuan, director of Batdongsan.com.vn in the South region, gives a few rules when investing in land.

First, the water-flow rule. Normally, real estate prices increase sharply in areas with rapidly increasing population, driving force for regional economic growth (urbanization, industrial zones, tourism …) or open infrastructure (highways, airports). , seaport…). Other areas without this factor will grow more slowly, even decades, to increase prices.

Oil spill rule. Population will spill out to live in areas around the local center or the center of megacities such as Hanoi – Ho Chi Minh City. HCM. That is, the investment selection area must have vitality; For example, 5-7km away, there must be a market, hospital, school, existing residential cluster…. Avoid investing in areas that are too isolated because sometimes decades later, there are still no people because depending on the spreading speed of local residents or big cities.

Must go to the land to invest to measure travel time as well as traffic connections with other areas.

The liquidity of the area being invested is also a rule to keep in mind. According to Mr. Tuan, it is necessary to learn about real estate websites for sale, survey the market to know about prices and population growth to know about demand, go to a notary office to see if the transaction is really high. or not, because if investing in areas where liquidity is low, it can be risky to bury capital and difficult to convert into money when needed.

Especially safety rules when investing. Mr. Tuan said that land investment must have a red book; separate books or at least public books with 1/500 planning through auction and without planning problems; need to learn the planning before spending money. For other types of land other than residential such as agricultural land, land for growing perennial crops, it is necessary to check the ability to land because it is possible to bury the capital, even illiquid.

ID