Why Buy Land?
Land Vs Other Assets
Why Land
- Land is a real tangible asset class.
- Excellent historical returns
- Opportunity to capitalise from uk housing crisis
- Passive and hassle free Investment
- Create real wealth by compounding returns
Equities
- Since 1985, land across the UK has increased in value by over 840%, which is significantly greater than equities, bonds and property. Land prices have increased by 165% since the year 2000. In 1983, the average home in the UK was priced at £31,621. By the beginning of 2006 this figure had increased to £169,901. This constitutes a 437% rise. The Dow Jones Industrial Average closed at the end of 1983 at the 1,220.58 mark. By the close of trade on the 31st of 10 January 2006, the market was at 10,900.40. This is a rise of 790%.
- The FTSE returned 406%, (closing at the 1,028.40 mark Christmas 1983 and standing at 5,779.80 as of 31st January 2006)
Commodities
- Oil was $17 per barrel in late 1999 and hit recent highs of $65 per barrel. However, over the longer term, i.e. 20 years, oil returned 141% against land’s 840% in the same period
- Gold traded at £300 per ounce in 1985 and £570 per ounce in January 2006, which was an all time high. This equates to a return of roughly 88% over twenty years.
You can Use your SIPP to buy Land
You may like to consider purchasing your land through a SIPP (Self Invested Personal Pension). This has many attractions and can be extremely tax efficient and cost effective.
Firstly, contributions into a SIPP are fully tax deductible. This can mean tax relief of up to 40 per cent on contributions.
Secondly, any assets held within a SIPP are exempt from income or capital gains tax. This means that any rental income the land can generate or any capital gain on subsequent sale of the land will be exempt from tax.