When it comes to investing in land with a view to turning it into a business, the advantages offered by developed land over other types of lots are key to achieving business growth goals and obtaining the expected Return on Investment (ROI).
In recent years, investment in commercial real estate has multiplied, generating higher income due to the growth of cities and the demand for services; two aspects that open up new areas of opportunity for business.
However, to increase the chances of having a profitable business, it is not enough to look at the development of the place and the market for opportunities; It is also essential to know what type of land to choose to make a profitable investment and avoid any type of risk.
In this article, we will talk about urbanized land and the advantages they have over rustic and undeveloped land.
What type of land to invest in?
Nowadays, thanks to the returns generated by the land, it is common to find a great diversity of land offered within the real estate market, and choosing the most suitable one depends on the objectives and expectations of each investor.
Investing is a decision that requires analysis and research, to avoid risks and capital losses. There are many types of investment that you can make depending on your age, but real estate investment coincides at all stages of life.
The type of land you buy will depend on the business idea you have or – in any case – if it will be used for housing. For both cases, it is always advisable to invest in urbanized land that allows you to save money.
Now, being clear that the land must be urbanized, it only remains to verify when you make the purchase, that it has the type of land use that you require, whether commercial, residential, or industrial.
What is urbanized land?
To better understand the above, we will define what urbanized land is.
Within the real estate offer, it is common to find two types of land: urbanized and those that due to their growth projection are options for long-term investment, but that do not have services or some type of urbanization that facilitates commercial development.
Although the latter has the advantage of being more accessible in price, they are not recommended land for business establishment, because they are located in areas far from urban centers and have little or no infrastructure and development.
In addition to this, sometimes they are common lands that cannot even be sold since they do not belong to an individual but to the state; Therefore, making a sale of this type would represent a risk for the investment.
On the contrary, urbanized lands are private property and intended for short-term construction, so they have various characteristics, for example, good location, basic services such as electricity, drinking water, drainage, and the documentation that guarantees its legality for providing legal certainty to the investor.
Uses and characteristics of urbanized lots
In general, urbanized land is planned for residential purposes, however, there are real estate companies – such as BMF Inversions – that manage urbanized lots for commercial purposes.
Whether to build a house or a commercial premise, it is necessary to have basic services on the ground; among the main ones are:
- Electric power
- Drinking water
- Sewer system
- Street lighting
- Sidewalks and ridges
Another important characteristic is that they are located near the urban area, which will make the land increase in value and obtain a profit in the medium term.
In addition to a privileged location, you avoid the additional expenses and the time that it would take you to do the paperwork and the necessary improvements to develop on your own.
How to choose a plot of urbanized land?
The first thing is to have a clear idea of what use you will give the land before making the investment.
Many people know the advantages of investing in land as a form of savings for retirement, since they are operations with a medium risk factor and that guarantees profitability in the medium term.
However, although buying an investment lot is the best option for retirement, you must establish a business plan; For it to be a successful investment, you must determine for what purpose you want to acquire the land.
Briefly, these are the steps you must follow to buy an urbanized land:
- Determine the use that the land will have, either to build a home or build business premises.
- Contact a real estate company – such as BMF Inversions – for advice. Remember, check the reputation of the company and that its lots are delivered urbanized.
- Find the ideal location for your project. If you want to start a business and build a commercial premise, make sure it is in an area with a high influx of people.
- Make a budget and consider the initial investment, as well as the processing and living expenses.
At present it can be easy to invest in real estate, you can even buy land online, however, before deciding on a real estate agency you should research and compare before proceeding.
This is due to the fact that among the great offer of investment lots on the market, not all of those on offer have urbanization.
Most of the cheaper investment lots are located away from residential areas, usually on the outskirts of the city in police stations or municipalities. The problem they present is that they do not yet have services and it is not known exactly when the city council will carry out the urbanization work.
For this reason, you should opt for companies whose land already has market studies that guarantee the profitability of the property and guarantee the increase in capital gains in the medium or long term.
Advantages of investing in urbanized lots
Investing in urbanized land like Blue World City offers the freedom to build and at the same time belong to an area that will provide endless benefits, compared to what it would be to do it in a rustic or ejidal area, away from the latent growth of urban sprawl and with legal risks that this implies.
Many real estate agencies use low-quality materials to carry out the construction of their projects, so it is safer to buy the land and build it yourself, to ensure that everything is done according to your needs.
And not only that, in general, they are larger extensions of land, unlike buying houses or prefabricated premises on limited lots.
Being located in areas of accelerated growth, urbanized land is a safe and profitable investment in the future for commercial projects. Due to their location and planning, they are the ideal opportunity for commercial developments, such as small business premises and convenience stores.
In addition, they expand the options of use and are an alternative to obtaining income from the investment even without having built, since their location and characteristics allow them to be leased to franchises or other service providers.
Another of its advantages is the capital gain that you will obtain year after year. As the demand for purchase increases and the city continues to expand in population and services, the cost per square meter of urbanized land will increase exponentially, reflected in a greater return on investment.
The price is also an advantage because you can buy pre-sale urbanized investment land saving a considerable amount, as opposed to buying it at the market price.
There are real estate companies that offer financing plans to acquire in a period of 24 to 36 months without interest, which results in savings and a higher profit margin in the future.
What to take into account when acquiring an urbanized land?
In addition to the location, price, and space, there are other factors that you must take into account when buying your land:
- Preferably choose a plot with a regular shape to make the most of the available space.
- Visit the land to verify the accessibility and condition of the surrounding areas, and corroborate the potential it has for a home or business.
- If you buy from an individual, hire the services of a real estate advisor and a notary public, to verify that the land is regularized and has no debts.
- If you’re not going to build right away, find out what you need to do to keep the terrain in shape and avoid the arrival of invaders.
- Secure your purchase by deed the land before a notary public, and for it to be registered in the Public Property Registry.
Where to invest in urbanized land to build a business?
To make a successful investment in urbanized lots, which allows you to have a profitable business, it is important to investigate which places and areas are experiencing greater economic development, and what services such growth is demanding.
In Mexico, the Mexican southeast has shown significant potential for investment thanks to its tourist attraction and economic development registered in recent years, especially in cities such as Mérida, Cancun, and Playa del Carmen.
There are many investment opportunities in Quintana Roo and Yucatán ideal for any type of project, with excellent prices and privileged locations.
On the one hand, the Yucatecan capital is one of the locations that has most attracted the attention of investors, due to its high-security rates and accessible costs that are offered within the real estate market.
Today, among the locations in Mérida to build a business, the east is one of the areas that represent the greatest opportunity to invest in urbanized land for commercial purposes; It is surrounded by residential areas and roads that guarantee a constant influx of pedestrians and vehicles.
It is an area where the commercial supply is growing, so it allows establishing businesses focused on different lines of business, to meet the demand for immediate consumer goods.
For example, in the state of Quintana Roo, in cities like Playa del Carmen, projects of commercial lots have been promoted thanks to the construction of houses. This has resulted in an increase in the possibilities of opening profitable businesses by boosting trade in the area.
In this case, the city has shown an important expansion towards the north, an area characterized by its proximity to the Arco Vial, the federal highway to Mérida, and the Cancun-Chetumal highway; three important roads that guarantee a constant traffic flow added to the flow of people residing in the neighboring subdivisions.
Invest in urbanized land, your best option
Due to its rapid growth, today the supply of urbanized land in Cancun, Mérida, and Playa del Carmen has been increasing to respond to the expansion that cities have registered and to promote commercial development in emerging areas.
Now that you know the advantages of buying an urbanized land in cities of the Mexican southeast, it only remains to find the ideal real estate company.
At BMF Inversions we have projects of urbanized lots for commercial use developed in areas of Quintana Roo and Yucatán, which increase the possibilities of obtaining high yields thanks to their strategic location and delivery characteristics that facilitate short-term construction.