Archive for 2010

Cheap Land for Sale in South Dakota

South Dakota, once a part of the Dakota Territory, became a state on November 2, 1889. The state has an area of 77,116 square miles and an estimated population of just over 800,000 people. Pierre is the capital and Sioux Falls, with a population of nearly 160,000, is South Dakota’s largest city. The western part of the state is an excellent location to seek cheap land for sale in South Dakota that might offer spectacular future potential. This part of the state contains Sturgis (where more than 300,000 motorcycle riders converge every year for the world famous rally); the gambling town of Deadwood (the historic site where Wild Bill Hickock was killed); and the fabulous Black Hills and Mount Rushmore (attracting more than 2.5 million visitors annually).

Cheap land for sale in South Dakota offers some of the best land investment and speculation opportunities available anywhere in the United States. In fact, South Dakota is one of the five states containing the lowest-priced land for sale in the nation. The other four states are Wyoming, Texas, New Mexico and Nevada. No other state in the United States – be it any state east of the Mississippi, any of the Great Plains states or Arizona, Montana, Idaho, Alaska, Colorado, Oregon or Utah – will have land for sale at cheaper prices than land available in these five states. Of the five states, however, South Dakota, Wyoming and Texas probably offer the best combination of low prices, wide market demand and relatively lenient subdivision regulations.

The term “cheap-land” refers to the per-acre price and not the per-parcel price. For instance, $47,840 for a 160-acre tract is a far cheaper price than $2,995 for a half-acre lot. The reason the 160-acre tract is cheaper is that it costs $299 per-acre, while the half-acre lot costs $5,990 per-acre. The key to success in buying rural land is to concentrate on the per-acre price and not the per-parcel price. Ever since the Pilgrims landed in 1620 and Americans began migrating west, land dealers have made fortunes buying land per-acre and selling lots per-parcel!

There is more to consider regarding cheap land for sale in South Dakota, however, than the price itself. While the price is of paramount importance, accessibility issues, title policy availability and applicable subdivision regulations also are major concerns. South Dakota has one of the most advantageous access policies of any state in the nation as state statutes require that all section lines be made available for road access and ingress and egress. Major title insurance companies provide title policies for landowners and there are very few state or county subdivision regulations affecting the sale of land in 40-acre sizes or larger.

In summary, South Dakota offers some of the cheapest per-acre land prices to be found anywhere in the United States, and is an excellent place to acquire a large tract of cheap land!

To view cheap land for sale in South Dakota CLICK HERE.

Dirt Cheap Land for Sale

When people see dirt-cheap land for sale, the first question they usually ask is, “But can the land be used for anything?” Following are just two historical examples to consider.

The Imperial Valley Venture

In the years between 1901 and 1907, the California Development Corporation attempted to build a water canal from the Colorado River westward into California’s Imperial Valley. The goal was to provide a source of irrigation and turn this dry, desolate and uninhabitable area into a subdivision of lush farms. Initially started by private promoters, the project eventually was taken over by the Southern Pacific Railroad with federal support promised by President Teddy Roosevelt. The United States Government owned most of the region and was offering dirt cheap land for sale at $1.25 per acre. The project failed after thousands of acres were sold and millions of dollars lost, and in 1909, the California Development Corporation was liquidated.

So what has happened to these dirt-cheap land prices during the last 100 years in the Imperial Valley? Much of the land is still without water, still desolate and uninhabitable yet it is very difficult today to find land in the Imperial Valley for less than $1,000 per acre.

Interstate Highway 80 in Wyoming

For a more recent example of dirt-cheap land for sale, consider the area along Interstate Highway 80 in Wyoming between the towns of Rock Springs and Rawlins. Local residents refer to the region as “barren and worthless.” Most of the dirt-cheap land for sale in this part of the state is in the checkerboard area (ownership of alternate sections divided between the federal government and private owners), which eliminates development potential. Known as the Red Desert, this area has no power, water, utilities or maintained roads. In 1990, land could have been purchased for as little as $15 per acre.

Today, 20 years later, ownership is still divided between the federal government and private parties, the area still has no power, water, utilities or maintained roads, and the zoning is unchanged. Yet this same “barren and worthless” land now sells for as much as $500 per acre.

If a person is seeking land for a specific use — such as agriculture, hunting, immediate development, or a site for a retirement cabin with utilities, trees and a creek running through the middle – then dirt-cheap land for sale probably won’t fit these needs. However, dirt-cheap land for sale is an overlooked real estate niche, as a large number of people have an almost innate desire to own such properties. Dirt-cheap land for sale is inexpensive to acquire and very exciting to own, because who can predict, with absolute certainty, future usage or values?

A hundred years ago, there were many popular, prominent stocks that no longer exist. These companies went broke, went out of business or were made obsolete by technology. However every single acre of dirt-cheap land for sale 100 years ago is still here today and is valued at a higher price. The predictable thing about dirt-cheap land for sale in the United States is that it will eventually increase in value as the result of nothing but the passage of time.

To view dirt cheap land for sale CLICK HERE.

Cheapest Land in Wyoming

Is there any other place besides Wyoming in the entire United States of America where one can find more land for less money?

The reason Wyoming presents such interesting investment opportunities is that there is a large amount of “checkerboard” land ownership in the state. The “checkerboard” ownership in Wyoming is among the largest of all 50 states.

A little history: The Pacific Railroad Act of 1862 was approved by the United States Congress and signed into law by President Abraham Lincoln for the purpose of aiding the construction of railroads from the Missouri River to the Pacific Ocean. This bill gave 10 miles on either side of the tracks to the railroad companies to help offset the cost of construction. The Pacific Railroad Act of 1864 expanded that distance to 20 miles on either side of the tracks. The United States Government retained half of every township given to the railroads by keeping alternate sections. This resulted in the ownership of these townships resembling a checkerboard, with every even-numbered section owned by the government and every odd-numbered section owned by the railroads. Over the years, the railroads resold a large portion of their holdings to private individuals.

For private owners of land in the checkerboard, there is a disadvantage offset by a huge benefit. The disadvantage is that it is almost impossible to secure “insurable access” through federal property; therefore, power and utilities are seldom available, and banks won’t loan for construction where there isn’t insurable access. “Physical access,” however, is a different matter. The government has never blocked access to private property since the Pacific Railroad Act of 1862 was passed; and furthermore, title companies will insure ownership of private land in the checkerboard.

The huge benefit for private landowners in the checkerboard is that “the public can’t cross private land to get to public land, but private owners can cross public land to get to private land.” This amazing policy means that private owners can access millions of acres of public land that the general public can’t get to, enjoy or even visit (because to do so would constitute “trespassing” on private property)! This unique ownership feature, coupled with a low purchase price, makes checkerboard land an asset that can offer substantial future potential.

The cheapest land in Wyoming can be found in the southern part of the state along the I-80 corridor. If you know where to look, land in this area can still be purchased for less than $250 per acre, but these prices are rapidly disappearing.

CLICK HERE to view the cheapest land in Wyoming.

How to Profit with Land

Various approaches to investing in land can range from “expensive and risky” to “affordable and safe.” On the “expensive and risky” side, let’s say a person purchased five acres on the outskirts of a growing city for $435,600 ($2 per square foot) with the intent of rezoning the land and developing a residential subdivision. This is a high-risk approach for the following reasons:

Rezoning might not be successful.

Financing might not be available to construct homes.

Loans may not be available for people to buy the homes.

The economy may weaken, causing demand for homes to evaporate.

The end result might well be a total loss.

On the “affordable and safe” side, let’s say a person did nothing but acquire 500 acres of rural land for the low price of $125,000 (only $250 per acre) with the intent of holding the land for some years into the future. This approach would be much less risky. In fact, history has proven that it is literally impossible to lose money by owning land if it is purchased cheaply enough and held long enough.

Suppose in 1920 (90 years ago), a grandfather had been given the choice of placing a sum of $100,000 in one of the following investments:

Studebaker stock (one of the leading Dow Jones stocks of the day);

United States currency; or

The deed to $100,000 worth of rangeland (20,000 acres worth $5 per acre), which he would place in a safe deposit box to be opened by his grandchildren 90 years later (in 2010).

Which asset would be worth the most to his grandchildren today (in 2010)?

Studebaker stock certificates would be worthless; the company went out of business and no longer exists!

$100,000 cash in the year 1920 has the same equivalent buying power today (2010) of only $10,000. In other words, inflation has robbed the dollar of 90% of its buying power in the last 90 years)!

20,000 acres of rangeland would be worth at least $5 to $6 million!

Buying cheap acreage and hanging on to it through the years might not be the fastest way to make money, but it could be one of safest and surest ways!

To view some spectacular cheap acreage investment opportunities, CLICK HERE.

The Tale of Two Rural Land Speculators

Wilfred and Barney were two rural land speculators who followed diametrically opposed philosophies. One was wildly successful, while the other failed miserably. Which speculator’s philosophy won out?

Wilfred specialized exclusively in buying expensive “trophy ranches” with county roads, utilities, streams, ponds, tall trees and breathtaking mountain scenery admired by all. Barney focused solely on acquiring barren land in the “middle of nowhere,” with no utilities, for the lowest price he could find; and nothing mattered to him except price.

Some years later Wilfred filed for bankruptcy. He sadly discovered too late that while everyone might admire breathtaking mountain scenery, such admiration can’t always be converted into profitable transactions. Barney, on the other hand, retired on his yacht in the South Pacific, since there were always willing buyers for cheap land, and inflation alone resulted in a substantial appreciation of his assets.

Wilfred dealt in “subjective” values (which are in the eye of the beholder and can fluctuate for many reasons), while Barney dealt in “objective” values (which are absolute in nature and can usually only appreciate)! Barney’s objective approach – which yielded large returns over time for relatively small investments – was the winning philosophy!

To view cheap land for speculation, CLICK HERE.

Cheap Acreage Speculation

Large tracts of unimproved land priced at just a few hundred dollars per acre — located in states like Texas, New Mexico, Utah, Nevada, Wyoming and the Dakotas — can provide tremendous long term potential. The dictionary defines the word “speculation” as “a business venture offering the possibility of a large profit but entailing risk.” However, history proves it is virtually impossible to lose money by owning land, if it is purchased cheaply enough and held long enough.

Cheap acreage speculation in the United States today is a real estate niche that is largely overlooked. That is unfortunate, because this activity can produce substantial profits without all the operating complexities and troublesome business cycles associated with residential, resort and commercial developments. Cheap acreage appreciates in value due mainly to inflation, instead of having to depend on rezoning, approval of development plans, financing and so on.

Inflation means that through the years, paper money is worth less and less and finite assets like land are worth more and more. Inflation is caused when a government prints trillions of new dollars, which results in the depreciation of existing dollars. At the same time the dollar is being depreciated, land is appreciating– because not one new acre can be created.

An example of the effect of inflation would be 5,000 acres of grazing land located in the “middle of nowhere” purchased 20 years ago (in the year 1990) for $30 per acre. Today the 5,000 acres would look exactly the same as it did 20 years ago; the use of the land would still be cattle grazing; zoning would be the same; there would be very little population growth in the area; no oil would have been discovered; no roads would have been built, and no development of any kind would have taken place. Yet the same 5,000 acres would now (in the year 2010) be valued at close to $250 per acre. Thus the initial price of $150,000 would have grown to $1,250,000 in 20 years, representing an eight-fold increase. And the amazing thing is that the landowner did absolutely nothing to cause this increase.

How did the stock market perform over this same period? In 1990, the Dow Jones was 2900, and today it is around 10,000, a little over a three-fold increase. What about the value of cash over the same 20 years? According to the U.S. Bureau of Labor Statistics it takes $165 today to buy the same goods and services that $100 purchased back in 1990. This means that inflation robbed the dollar of 40% of its purchasing power in just the last 20 years.

There are countless business people in the United States today who, with brilliance and fortuitous timing, have made huge sums of money in various enterprises. However, speculating in a large tract of cheap acreage just might represent one of the surest and safest long-term assets a person can own!

Invest in Cheap Land

The opportunity to invest in cheap land in America should be thoroughly and seriously explored. Cheap land is a very safe asset, and one that is certain to increase in value in future years. Cheap land can’t be stolen, destroyed by fire, outdated by technology or reproduced. All that is required for cheap land to increase in value is inflation and a greater population, both of which are inevitable. Following are just two historical examples to consider.

In the years between 1901 and 1907, the California Development Corporation attempted to build a water canal from the Colorado River westward into California’s Imperial Valley. The goal was to provide a source of irrigation and turn this dry, desolate and uninhabitable area into a subdivision of lush farms. Initially started by private promoters, the project was eventually taken over by the Southern Pacific Railroad with federal support promised by President Teddy Roosevelt. The United States Government owned most of the region, and was offering land for sale at $1.25 per acre. The project failed after thousands of acres were sold and millions of dollars lost, and in 1909, the California Development Corporation was liquidated.

So over the last 100 years, what has happened to land prices in the Imperial Valley? Much of the land is still without water, still desolate and uninhabitable, yet it is very difficult today to find land in the Imperial Valley for less than $1,000 per acre.

For a more recent example of people who decided to invest in cheap land, consider the corridor along Interstate Highway 80 in Wyoming, between the towns of Rock Springs and Rawlins. Local residents refer to the region as “barren and worthless.” Most of the cheap land in this part of the state is in the checkerboard area (ownership of alternate sections divided between the federal government and private owners), which eliminates development potential. Known as the Red Desert, the area has no power, water, utilities or maintained roads.

In 1990, land in the Red Desert could be purchased for as little as $15 per acre. Today, 20 years later, ownership is still divided between the federal government and private parties, the area still no power, water, utilities or maintained roads, and the zoning is unchanged. Yet this same “barren and worthless” land now sells for as much as $500 per acre.

For those who invest in cheap land, it is the per-acre price that is important, not the per-parcel price. For example, a 160-acre tract for $31,840 is far cheaper that a one-acre lot for $4,000. Why? Because the 160-acre tract is priced at only $199 per acre, and the one-acre lot is priced at $4,000 per acre. Ever since the Pilgrims landed in 1620 and Americans began migrating west, people have made fortunes buying land by the acre and selling lots by the parcel!

CLICK HERE to view various opportunities to invest in cheap land.