Image courtesy of Realtors Land Institute, 2020
Over the past 50 years, farmlands have remained a solid investment option, yielding high returns and low risks (Realtors Land Institute, 2020). According to Marketwire (as cited in Realtors Land Institute, 2020), farmlands have appreciated at a rate 2% higher than inflation since the 1950s, making it a red-hot investment right now.
By its simplest definition, farmland is “land that is used for or is suitable for farming” (Farmland, 2020). This investment option has been gaining popularity across the globe as the growing global population increases the demand for food. It is also unlikely to pose losses as farmlands continue to produce products that are in high demand and likely always will be: meats, grains, fruits, and vegetables.
Why is farmland a good investment?
One of the most apparent benefits is having a tangible asset when you invest in farmland. When you own one, there are several options for making a profit, mainly by growing and selling your crops, or leasing your property which would save you a lot of work while still allowing you to reap some rewards. You can also add value to your property by swapping lower-end crops to higher-end crops such as trees.
In the Philippines, farmlands are even more valuable in a sense that almost all arable land in the country are already in use, and urban sprawl and land development has led to its scarcity. Because of this, the value of farm lands continue to increase, especially when these pieces of land are located close to residential developments. As a farmland owner, you also have the option to convert your property into an Agro and Eco-Farm Tourism Business. There has been an increasing trend in transforming farms into farm resorts, “offering recreational and agricultural activities and showcasing the culture and traditions of the place” (Dimamay, 2019). You can attract tourists through exciting activities, top-notch accommodation, and great local food which can be sourced directly from the farm. This can give them an immersive experience on your property and at the same time generate you some extra income.
Image courtesy of Dimamay, 2019
The bottomline
Globally, farmland today is a $9 trillion market (Realtors Land Institute, 2020). It might be financially challenging in the onset, but with its historical investment success, it can truly be worthwhile to put your money on it. Similarly, with what is happening in the world now, it would also be useful to be self-sufficient and provide ourselves with the basic necessities such as food – an advantage that only farmlands can offer.
References
Dimamay, L. (2019). Reasons You Should Buy Farmland In The Philippines. Retrieved from https://www.ifilneurrealty.com/reasons-need-to-invest-farmland-in-the-philippines/
Farmland. (2020). In Cambridge Dictionary. Retrieved from https://dictionary.cambridge.org/us/dictionary/english/farmland
Realtors Land Institute. (2020). Why Farmland Is A Good Investment. Retrieved from https://www.rliland.com/farmland-is-a-good-investment/