When buying vacant land or undeveloped residential plots, it does not, in actual fact, involve any type of property; not at the time when you purchase it. But, in future, some type of property will sit on the land or plot. There are endless possibilities of what vacant land and plots can be used for.
Possibilities when Buying Vacant Land or Undeveloped Residential Plots:
Buy and Sell at Higher Price; this means that you believe that the purchase price was below market value and you hope to find a buyer that will buy at your new higher price. The term for this type of purchase and sale is “flipping the land”.
Buy and Hold the Land; while you believe that the price of the land will increase in value. You need to pay the normal taxes and maintenance of the land during this holding time.
Buy Rezone and Sell; the land you purchased might be zoned for a specific use. The land around has been developed and the land will be worth more if you rezone it. For example, it could have been zoned for commercial use but now the area developed has become more residential. Re-zoning it will make it more valuable for possible potential developers. The fact that the zoning has already been changed will save them time and money.
Buy Develop and Sell; buying the land, develop it by building a home, and sell it to someone that would like to live there. If the land is bigger, you can start a vineyard or vegetable patch, and sell to a buyer that like the fact that the land is already cultivated and it can just be managed.
Buy Develop and Hold onto the Land; you purchase the land with the intention to develop it for yourself. You can build a department building or townhouse complexes to rent out to tenants. You can also build a shopping centre and rent space out to retailers.
There are numerous more options to do with vacant land. The possibilities are endless and whichever way you go about it, there is an income to be made, one way or the other.