Although increase in value seems certain due to the scarcity of land, we still want to expressly point out to you that there are risks to this investment. The primary risk that investors in land face is that the land is not rezoned, the rezoning takes longer than expected, or that a rezoning does not turn out to have the positive effect on the value that was expected. This means there is a risk that the investment will depreciate in value or fail to appreciate in value.
In principle, the risk as investor will be no greater than the sum that was invested when purchasing the land. There is also the risk that the value of the land, as agricultural land or as development land will decrease in value or not sufficiently increase in value as a result of, for instance: lower-than-expected economic growth, a decline in demand for residential and commercial property, rising mortgage interest rates, the financeability of housing and commercial building, or changes in (fiscal) regulation regarding home ownership or business property.
There is also the risk related to the limited marketability of the land. The land cannot be sold via a regulated market. As a result, the group of potential buyers is limited. This limits the marketability of the land. That means there is a chance that investors will not be able to sell for the price they want when they want. It is also possible that, in addition to the lack of the ability to sell on a regulated market, there is no interest for the land or that the price that is offered is so low that the land will have to be sold without a return on investment or even at a loss.
After you become the owner, you are responsible for the management of the land. We supply the land free of lease and/or third-party usage rights.