Terraqua - Land Investment

The Land Investor

News and Commentary on Land-based Investment

Buy a Ranch or Stuff the Mattress?

As the Tax Hammer Comes Down the Tax Deferral Benefit of Land Investment Allures HNW Investors

John Watson/Fay Ranches Today’s online Private Wealth Magazine included an article titled: As Wealth Gap Rises, Super-Rich Stuff the Mattress. It points out the tremendous amount of cash built up by wealthy individuals since the credit shock and global recession of 2008/2009.  Cash positions for the high net worth exceed positions held in any other asset class and are double pre crisis levels.

The Private Wealth article cites concerns in both the U.S. and UK, as cash continues to accumulate, domestic taxes may be imposed on cash holdings themselves.  This cash-hoarding psychology in itself “at least partly reveals the level of anxiety among these groups that changes to taxation or income regimes are only a matter of time….the fact that cash continues to pile up regardless shows the depth of the concern that change is at hand.”

As the tax hammer comes down on income, capital gains, dividends, gifting to heirs, and now; possibly on cash itself, the tax deferral benefit of real estate investment remains in the tool box.  This is not a concept I have to sell to my HNW clients – but this is what they are telling me is a big part of their motivation, instructing me to actively source direct; investment quality ranchland, farmland and timberland investments.  A land investment can have real intrinsic value that can be built over time, returns boosted and diversified through thoughtful management; and is a particularly appealing asset allocation and capital preservation strategy.

Buy a ranch or stuff the mattress?  I’ll take the ranch, thank you.



This entry was posted in Farmland, Fay Ranches, Financial Advisor, Land Investment, Legacy Landbank, Private Land Marketing, Private Wealth, Ranches, Recreational Land, Timberland, U.S. Farmland. Bookmark the permalink. Post a comment or leave a trackback: Trackback URL.

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