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Why Buying Land is Different from Buying a Home

For many individuals, buying a new home or a piece of land does not all seem different. The reason is that both acquisitions are considered to be property purchases.

However, there are many differences that you should keep in mind when considering investing in real estate. You should be aware of all the deficiencies and benefits related to both investment possibilities.

Here are some significant differences between buying land and buying a home.


One of the major benefits of buying land is that plots are simple to take care of homes.

Naturally, this does not mean that you can invest in the land and then completely ignore it. But managing a piece of land is less complicated than managing other kinds of residential and business assets.

To begin with, there are several considerations to be made when it comes to investing in a home.

For example, to handle anything from basic sewage and electricity concerns to important remodeling and restoration jobs.

In contrast, it isn’t even necessary to routinely visit your land, especially if you’re buying it as an investment. You won’t have to worry about paying any utility bills. Moreover, the property taxes assessed on your land are not excessive.


It can be very difficult to get financing from banks for the acquisition of land. This is a significant drawback of opting for land purchase. Many institutions that would typically finance real estate or suburban homes won’t do so for tangible investment like land.

Financial advisors typically refrain from taking this kind of risk because they view it as being extremely dangerous. Thus, this is a factor that needs to be carefully considered if an investor doesn’t already have sufficient finances for the purchase of land.

Besides, there are different types of loans available for buying a house and land.

The tenure of a home loan is much longer as compared to land. The maximum tenure of a home loan is 30 years; meanwhile, the maximum tenure of a land loan is 15 years.


No matter how much land you have, the decision to buy and keep it as an investment is entirely up to you.

The owner of the land is completely free to use their land in all respects. The owner can use it for cultivating crops, building a house or farm, or both.

Of course, you’ll have to exercise caution to ensure you do not exceed your set budget.

Following the terms of your land contract, you must obtain licenses and abide by all laws and ordinances. However, you would still be able to design your home (if you choose to build one) based on your personal preferences.

Higher Resale Value

When deciding whether to invest in a piece of land or a house, keep in mind that a plot of land is typically simpler to sell than a home. The explanation is simple: the value of land increases over time but the resale value of a home gradually decreases.

Your home will consistently decrease in value. Even though you might be able to promptly rent out your home for a reliable source of income due to its outdated appearance and routine wear and tear, its economic value will decrease.

The value of your dwelling property can also decrease as a result of the development of new, contemporary neighboring buildings that offer greater amenities.

As such, the worth of land increases rather quickly in contrast to homes. That is particularly true if the land is situated in a well-known or well-equipped location. Also, a sizable portion of wealthy buyers always favors purchasing land as an investment over pre-built houses.

Further, do not forget that it could be challenging to sell an old house. As the majority of homeowners need to put both time and money into addressing significant issues to make their homes appealing to prospective buyers.

This is arguably one of the most crucial questions to ask when buying land -Will the land’s resale value be higher than its purchase value?

Despite the lack of immediate revenues, purchasing land is a wise decision for people looking to make long-term investments. The high resale value will compensate for the fact that the land can simply lie there for a long period without producing any profit.

The Land value summary survey report USDA, National Agricultural Statistics, shows that the value of cropland has increased by an average of $320 per acre (7.8%) from the previous year 2021.

6 Land Values 2021 Summary (August 2021) USDA, National Agricultural Statistics Service 2,530 2,760 2,640 2,700 2,980 3,350 3,810 4,090 4,100 4,040 4,030 4,050 4,100 4,100 4,420 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Dollars per acre Average Cropland Value – United States: 2007-2021Average Cropland Value – United States: 2007-2021


2021 cropland value by state


Better Investment Option

Both types of investments have their fair share of benefits and drawbacks. But purchasing land is frequently regarded as a superior option due to the numerous advantages it offers.

For instance, you will benefit if you buy USA Land as there are minimal restrictions enforced by the USA government. Additionally, the value of land has been steadily rising and is predicted to continue doing so.

If you ask yourself – why buying land is a good investment, you can come up with several reasons such as –

  • Compared to property, land requires less capital input.
  • Land requires extremely less maintenance compared to a house.
  • Due to the varied client expectations, selling a house at the optimum price is more difficult than selling land at high prices due to the great demand for it.


The main difference between purchasing a piece of land and a home ultimately comes down to your purpose.

Going ahead and buying a house rather than a plot of land may save you both time and money if you intend to construct a home and lease it out. On the other hand, purchasing a plot can be a far better choice if you’re intending to make a financial investment.

Furthermore, whether you’re buying a house or a plot of land, it’s in your best interest to have a seasoned real estate agent on your side.

Working with an expert offers many benefits, including helping you to understand the market. Knowing when the market is experiencing a boom phase will help you make fruitful investments. You’ll increase your future earnings by conducting the required research and getting expert assistance.