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Very southern Mn | If you are just looking at return, land has same risk if you compare investments. Interest goes way up, land will probably come down. Investment is under performing but principal amount still intact. Interest goes way down, land will probably go up, but investment is locked at a higher rate . Land is a better inflation hedge but one doesn’t generally sell it, in fact could make your estate more complicated if land continues to go up. Land advantages are that it can be a great generational wealth builder under current estate tax laws. It also is a great forced savings plan much like a home. You are also as a farmer investing in your self as you make better use of equipment, land improvements and inflation actually works in your favor ( historically as you pay for farm with inflated dollars). Finally especially as I get older, I get far more joy out of farmland than a new tractor or whatever that is so fleeting, things constantly becoming outdated with technology or even parts no longer available, etc or a vehicle like a camper or new car that is depreciating faster than you | |
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Cash, accrual, opportunity cost, accounting.
