The Importance of Buying Land
Who doesn't want to create assets? All of us invest money for creating an asset. What exactly does the word asset mean? Asset simply represents the ownership of any material or object which can be converted into immediate cash at any time. Some people get mixed up between the words asset and investment. Although these two words are correlated they do have a different meaning. Investment can be financial or else in terms of goods or materials. In macroeconomics investment is the amount purchased per unit time of time of goods which are saved for future production and are not exploited. On the other hand, asset is something owned by a person as a result of an investment he has made. People invest their money in buying land, residential apartment or certain materials like gold. Investment is mainly made keeping it in mind that the present expenditure may yield a profit in the upcoming future. None of us invest money for creating an asset which has no resale value.
No investment is free from risk factor and to achieve in life we have to take some risk. As we have discussed, land is of course worthwhile to make an investment. As it is said "There is no good without evil", likewise investing money on land also has certain demerits and merits. As land is a resource which is getting depleted at a fast rate its demand is increasing on day to day basis. Thus this increasing demand will always put an upward price pressure on land. A bare land without any improvements in the form of structures built in it makes the land more affordable. The resale value of land is increasing and hence it proves to be a best option of investment. Land has relatively low maintenance costs. It offers choices to the person making the investment. That is, land is available in varying sizes. Even if you do not have enough money to buy or build your dream home, you can easily make money by buying a piece of land in your name. You could rent it or lease it and just live with the monthly earnings for the rest of your life.
But, there are certain disadvantages as well. You may not have immediate cash in hand and profiting from it may take years. For getting immediate profit or income a rental property would be a better option. Bahrain is developing tremendously at a fast rate and hence it is of course a good option to own a property in this place. Although it is highly difficult to purchase a property in Bahrain, the transactions costs are very low. If you are looking out for a long term asset, the best way is to invest some money in buying some land. Land is the only asset where the price does not deprecate with age.