Recently, nervous investors have been jumping off the stock market rollercoaster and fleeing the deflating housing market. So the question is, where can a person invest now and be sure the value of the investment will increase, without the loss risks associated with other investments?
The answer lies in buying land dirt-cheap. Land in the “middle of nowhere” that’s barren and undeveloped. So how can the value of land purchased dirt-cheap increase?
Consider this example: In 1963, Robert P. McCullough, a Los Angeles real estate promoter, purchased 3,500 acres in an isolated area of the Arizona desert and began building Lake Havasu City. Initially, building lots were offered for sale at prices as low as $4,995 each. The city was programmed to attract 75,000 people by 1980. People ridiculed Mr. McCullough and called him a daydreamer. When there was no stampede of people wanting to settle there, Mr. McCullough decided he needed a promotional gimmick. He purchased the London Bridge, and at a cost of $8 million, he had it shipped from England to Lake Havasu City.
Today, Mr. McCullough has been dead for many years, but Lake Havasu City, and the surrounding Mohave County, are booming and no longer in need of promotional gimmicks. The population of the county is 198,000, there is a community college, and lots can sell for as much as $200,000 and homes as much as $750,000 – all located on what once was land dirt-cheap.
Here’s a different example: Most of the far-western counties of Hudspeth, Culberson, Loving, Reeves, Jeff Davis and Presidio, in the State of Texas, are considered to be barren and worthless. This region is sparsely populated, and the infrastructure of utilities, power, water and roads is very limited. In 1990, you could purchase land dirt-cheap there for as little as $15 per acre. Today, the region is still sparsely populated and the infrastructure is still very limited. But now, this “barren and worthless” land sells for as much as $500 per acre.
What makes the price of land dirt-cheap rise? The answer is “time.” Over time, prices inevitably rise. If an investor can purchase land dirt-cheap and hold it long enough, the price could increase substantially. Land dirt-cheap is inexpensive to acquire and exciting to own, because no one can predict with certainty how that land may be used in the future or how much the value may increase.
In the last 100 years, many investments have disappeared, and their investors have been wiped-out. But every acre of land dirt-cheap that was purchased 100 years ago still exists and is valued at a higher price.
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