What Investors Should Know About Opportunity Zones

by Caroline Kirby

Opportunity Zones have been a hot topic of interest ever since their creation by the Tax Cuts and Jobs Act on December 22, 2017. Even though it’s been nearly two years, the real estate industry is buzzing with questions around what it means and how to create profitable opportunities from them.

If you want to learn more about these opportunities and get full advantages, you need to understand some basics.

Opportunity Zones Explained

The IRS explains Opportunity Zones as “an economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment.” They were created to encourage economic development and job creation in distressed communities.
These areas must be nominated by the state and then certified by the Secretary of the U.S. Treasury (who has been designated authority by the IRS).

The first set of Opportunity Zones were established in April of 2018 and spanned across 18 states. Since then, zones covering parts of all 50 states, the District of Columbia and five U.S. territories have been assigned.

Now that we’ve covered the basics, let’s get into the significant parts. You don’t need to be a tax expert to understand the benefits, but it can be complex. To receive full benefits, you may consider consulting a tax professional. Two important things to note are:

1. Investors don’t need to live in an Opportunity Zone to get tax benefits.
2. You must invest in a Qualified Opportunity Fund (QOF) to receive the benefits.*

*The QOF is an investment channel that is set up as either a partnership or corporation for investing in eligible property.

What can investing in a Qualified Opportunity Fund do for you? Here’s a quick rundown of some significant points:

Gain Deferral:

Capital gains reinvested (within 180 days of a sale to a non-related person) into a QOZ are tax-free as long as they are held in the program, through 2026.

Tax Exclusion for Investments Held for 5 Years:

If held for five years, the tax paid on the reinvested gains is reduced by 10%; if held for seven years, that reduction is increased to 15%.

Permanent Tax Exclusion of 100% of Taxable Gain:

Gains accrued on deferred-gains funds while invested in a QOZ are tax-free if they are held for at least ten years.

Check out LandHub’s current listings and blog for inspiration. Opportunity Zones provide a unique chance to enjoy returns, save on taxes, and stimulate economic opportunity depending on how you use your new land.

If you’re looking for more insight into Opportunity Zones, their purpose, the regulations and policies, as well as actionable steps on how to leverage this information to create value check out this webinar from Realtors Land Institute.

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Lease Your Land for a Solar Farm

by Caroline Kirby

Do you have available acreage and no plans on how to use it? You should consider leasing your land for solar power projects! In the last few years, farmers across the country have been approached by solar companies looking for open land to lease for their solar projects.

Using your land for a solar farm could bring a lot of benefits. Here’s what you need to know!

The Basics of Leasing Land for a Solar Farm

Solar land leases are a contract between a landowner and a solar developer. The solar developer is leasing your land to install photovoltaic (PV) solar arrays to generate electricity. While the electricity from these systems does not benefit the landowner, the landowner will still enjoy the benefits of receiving lease payments.

There are many considerations to address when deciding if leasing to solar developers is the appropriate option for you. Every state has different regulations as do the local communities. Before entering into a lease agreement you will need to research your local laws and restrictions as well as garner community support, if applicable to your land’s location.

What Are the Benefits of Leasing Your Land for Solar Projects?

While every project varies as do the rules and regulations per region, there are some uniform benefits to leasing your land for solar energy regardless of the amount of land or location. Here are a few:

  • Maintain ownership of your land.
  • Long-term lease agreement.
  • No carbon emissions.
  • Creation of local jobs.
  • Financial security.

How Do I Know if My Land Qualifies?

Depending on the developer you try to enter into an agreement with you may be subject to different factors. However, some of the most common factors that may determine if your land is suitable for a solar farm include:

  1. Located near transmission lines and substations.
  2. Geological characteristics are favorable (flat slope, few rocks, and trees, etc.)
  3. Available acreage (generally a minimum of 10 acres)
  4. Accessible for long-term leases (20+ years)

What do you think? Does your land check off these boxes? You may want to spend some time looking into leasing your land for a solar farm. Solar developments can take a lot of time and money, but the good news for you is that the developers will take the lead.

Are you interested in earning money now and helping to generate clean and sustainable energy for your community? Do some research and find out what solar developers are interested in your area. If you want to look for other land investment opportunities, take a look at LandHub’s current land listings here.

Like this article? Please feel free to share or post a link on your site: https://www.landhub.com/blog/lease-your-land-for-a-solar-farm/

Benefits of Owner Financing for Your Land Purchase

by Geoff Hurdle
Hurdle Land & Realty, Inc.

Buying land is a substantial investment, and many first-time buyers aren’t aware of all their financing choices or may feel intimidated by the process. There are a variety of options when it comes to financing property, but the traditional forms may not always be viable. Have you heard of owner financing? Are you aware of the benefits? Read on to learn why owner financing your land purchase may be your best option!

What is Owner Financing?

Owner financing (also called seller financing, seller terms or bond for title) is just what it sounds like; it’s a form of purchasing that allows the buyer to get financing from the seller rather than a bank. The property owner replaces the bank and payments will be sent directly to the owner, unless the owner chooses to sell your loan, in which case you will send payments to the investor(s) who purchased the loan.

Owner financing land is not uncommon, in fact, many sellers are willing to finance a buyer’s purchase. It’s also quite challenging to secure bank loans for vacant land deals, people looking to move off the grid, or even families interested in diversifying their portfolios. If you’re not seeking a well-established and costly chunk of land (like a ranching operation or serious acreage), then banks likely won’t give you the time of day.

Luckily, owner financing is on the table, and there are some great benefits for you!

The Benefits of Owner Financing Your Land Purchase

  1. Flexibility in Securing a Transaction: Traditionally, lenders have rigid requirements that won’t budge, but with owner financing, both parties can leave the deal happy. Different characteristics like down payments, payment amounts, length of the loan, interest rates, and more are open for discussion.
  2. Quick Closing Process: When you’re in direct communication with the seller for all parts of the purchase you’ll see that the closing process is much quicker, by cutting out all of the middlemen you and the seller can finalize the process on your terms.
  3. Save Money: When you seek lending through an institution there will be fees upon fees and hidden costs that could run into the thousands. When you opt for owner financing you won’t have high bank fees, loan arrangement fees or closing fees to worry about.
  4. Good for Buyers with Marginal Credit: Often times owner financing doesn’t always require a credit check, but some may. Although due to the more open nature of this financing option you may be able to work something out with the seller.

Although different in many ways from traditional loans, owner financing still has some structure. A promissory note will be created by the buyer and seller that details the repayment schedule, interest rate, and the consequences of defaulting on the loan.

This alternative financing method is often viewed as a win-win for all parties involved, and it can ultimately get you onto the land you purchased more quickly. Are you interested in searching for available owner financing properties? Check out the latest on LandHub.com here!

Like this article? Please feel free to share or post a link on your site: https://www.landhub.com/benefits-of-owner-financing-for-your-land-purchase/

3 Reasons to Invest in Land in Tennessee

by Caroline Kirby

Thriving culture, musical hotspots, and the most visited national park (the Great Smoky Mountains National Park) in all of the United States can all be experienced in Tennessee. With growing cities like Memphis and Nashville, investors have been flocking to the Volunteer State in the last few years.

Great investment opportunities, large areas of forest land, rangeland, and 44% of the state’s land dedicated to agriculture all make for big reasons why Tennessee should be at the top of your list when looking to buy land.

So, what makes Tennessee so lovable and livable? Here are our top reasons:

  • Good schools and ranks #26 nationally for education with more than 75 colleges and universities across the state.
  • Thriving job market with one of the lowest unemployment rates in the nation.
  • Comfortably low cost of living and no income tax for residents.
  • Natural beauty with mountains, waterfalls, rivers, and more!
  • Tons of culture—especially when it comes to music! Appalachian bluegrass, country, rock & roll can all be found across TN.
  • Strong network of hospitals and healthcare facilities.

These quick facts are just to get your attention. When it comes to purchasing land in Tennessee there are a lot of great options. Still need some convincing? We’ll break down three more reasons you should consider investing in land in Tennessee.

  1. Retirement Friendly: Are you planning for retirement? Depending on where you live in the U.S. you may be looking to slow things down or change up the routine as you step back from work. Whether you’re looking for a full-time place to live or a vacation getaway Tennessee has a lot to offer. Tennessee attracts many retirees due to its tax-friendliness. Tennessee residents do not pay state income tax, and Social Security retirement benefits are also untaxed. Property taxes are low as well with an average effective rate of just 0.75%.
  2. Home Value on the Rise: Tennessee’s median home values have risen by over 8% since 2017. Although the state’s median home value is still lower than the national average, it’s expected to rise by over 5% this year! Steady appreciation means opportunity for investors who are looking to establish their rental portfolios.
  3. Hunting is Big Business: In Tennessee investors can earn additional income through hunt leases on private land. Tennessee has 4 distinct hunting regions meaning a lot of opportunity for diversity and capital gain. With land for great prices you could buy a few properties and start leasing out during the different hunting seasons.

Like what you’ve read so far? We think Tennessee has a lot to offer whether you’re looking to live there or solely to invest. You can check out all of our current Tennessee listings here, but we’ll help you out by highlighting some of our top listings below.

Land Listings to Look Out for in Tennessee

  • Morton Barn with stables, 30+ acres, and all the amenities.
  • Hunter’s dream of 605 acres with barn, ponds, timber, and mineral rights.
  • Private views of TN mountain range and a convenient drive to Fall Creek Falls state park.
  • 2 Acres of Awesome in Cleveland, TN.
  • Prime Location, private with Smoky Mountain views.
  • Plenty of tillable acreage for crops or food plots for wildlife.
  • Marina, boat launch and country style living offered in gated lakefront community.

Have some land you’re looking to sell in Tennessee?  We recommend taking a look at our membership opportunities so you can sell your land quickly!

Like this article? Please feel free to share or post a link on your site: https://www.landhub.com/3-reasons-to-invest-in-land-in-tennessee/

5 Perks That Will Make You Want to Buy Waterfront Property

Waterfront property 1a

by Caroline Kirby

Living on waterfront property is a dream many people have, they imagine themselves enjoying their morning coffee on a deck overlooking a lake or walking out their front door for a quick stroll down the beach. Even if this isn’t your dream, it may be somebody else’s, and that possibility is what leads us to make our point that waterfront property is a good investment.

Here are some of our top reasons for buying waterfront properties.

5 Perks that Come with Waterfront Property

  1. Prime Investment: Why may you ask is waterfront property such a good investment? Because it’s scarce and if you’re one of the fortunate people to secure land on the water you’ve joined an exclusive club. It also comes with excellent resale value and the potential to rent!
  2. Access to Cool Activities: Have you been itching to spend more time outdoors? You won’t have any excuse now. Being on the water gives you instant access to fun activities like swimming, kayaking, boating, etc. And bonus points if you’re already an avid fan of these activities because you’ll actually be saving money—say bye to storage and club fees! Now you can practice in your own backyard.
  3. Good for your health: Apart from the benefit of having tons of activities readily accessible, being near the water also offers you better air quality. Properties in open spaces on the water have less environmental air contamination, especially if you’re comparing to the quality of air in the city. Additionally, you’ll likely experience less stress when you’re in a calmer atmosphere than the daily hustle and bustle of suburban or city life.
  4. Incredible Views: This perk is typically at the top of most people’s list. Depending on where you are you will be able to see a beautiful lake, the open sea, or even a wildlife reserve from your home! You may also be lucky enough to have a secluded property and have the added benefit of privacy.
  5. High Demand: Waterfront properties are in high demand meaning if you ever want to rent or sell your property finding a buyer likely won’t be difficult. As we mentioned before waterfront properties are scarce and there are always people looking.

Are you convinced? If you’re ready to start searching for your waterfront property here are a few suggestions. Have a waterfront property you want to sell? We can help with that too! Choose your listing plan here and start posting on LandHub.com.

2 Great Waterfront Properties Worth Looking At

Whether you’re looking to buy, sell, or both we can help! Browse all waterfront properties or check out our listing plans!

Like this article? Please feel free to share or post a link on your site: https://www.landhub.com/5-perks-that-will-make-you-want-to-buy-a-waterfront-property/

What to Consider Before Building on Your Vacant Property

green field

by Laura Mueller

Building on vacant land is a great way to increase its value and get more out of your investment. But whether you are currently the owner of land that you want to build on or are looking to purchase land for future development, there are quite a few factors to keep in mind. The key to maximizing the benefits of any build are to find a balance between what you want to accomplish, what’s possible, and how much you want to (and can) spend. Below, we’ll go over six of the things that you should always consider when you’re thinking of building on your vacant land.

  1. Zoning

Your building dreams can only stretch as wide as your local zoning rules allow for, so make sure that a meeting with your local Building and Planning Department is right at the top of your to do list. You probably read up on the zoning regulations around your property before you decided to purchase it, but it’s always a good idea to run back through the details before you figure out your building plans.

  1. Future development plans 

Check to see if there are any plans already in place for development around your land. If there’s going to be a new road, commercial development, residential development, or so on popping up near your property soon, you’ll want to consider if it will affect your building, and how.

  1. Existing utilities

 What utilities will your building require? What utilities are already available on site and what will need to be brought in? These are all huge questions to answer prior to deciding on the scope of your build, since they can have a major impact on the ultimate cost of your project.

  1. Budget

 Speaking of cost, solidify your budget early on, accounting for not just building materials and construction costs but permits, utility lines, and anything else that you will need to turn your blueprint into an actual structure. And as with all building projects, leave yourself some wiggle room in your budget, since unexpected costs almost always have a way of creeping in. 

  1. Financing 

How do you intend to finance your build? Financing works quite differently for land loans and building loans, so your path is going to look a bit different than it did for the land itself. Look at a few different financing options so that you can be sure to pick the one that will make the most sense for your bottom line in both the short and the long term.

  1. Topography 

The topography of your land, as well as the topography of the land around you, should definitely be a top consideration when you’re creating your building plans. Identify where land will need to be leveled, where water tends to gather, and what kind of soil you’re facing so that you can be sure to choose the absolute best spot on your property for a structure.

If this is your first time building on a vacant lot, build a team around you—from your contractor to your loan broker—who have proven experience making it happen. The more expertise and guidance you have, the less stress it will take to make your building happen.

Like this article? Please feel free to share or post a link on your site: https://www.landhub.com/what-to-consider-before-building-on-your-vacant-property/

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