What makes each piece of land special? We all know the big three… Location, location, location, but there is a bit more to it, believe it or not. There are four Economic characteristics of land, they are:
Scarcity – there is a limited amount of land on this planet… the total supply is not limitless
Improvements – Is there a building on the land? Or is there toxic waste under the land?
Permanence of Investment – are the utilities available or installed on the land? Is it cleared or is it wooded?
Location – rather obvious, but includes a number of different factors that can be unique to each parcel of land
Then we have Physical characteristics. They inlcude:
Immobility – You can move the land. You can move the dirt on the land, but that location will always be there.
Indestructibility – Land is permanent, this lends to the stability of land as an investment
Uniqueness – No two parcels of land are exactly alike, because they must occupy different space, so each parcel is different.
What does this help you when it comes to buying your next home or negotiating a better price. Probably nothing, but the better you know the basics of how this industry works and some rules that govern it, you will be a better educated home buyer, and that is our goal, isn’t it?
