Investing in land or property can be immensely profitable if done correctly. Even with the financial crisis and all the instability that followed property investments can be quite profitable if enough research is made before spending any money on the land itself.
First of all you need to know your exact budget, your cut-off point and what you expect to realize with the land, plot, or building. There are generally two types of touristic property investments you can make and the difference is generally made by the initial budget not by potential for profit.
The first and most well-known type of investment is in already famous or growing markets. You won’t surprise anyone by buying land in a popular French Alps skiing village or in a Spanish seaside resort as most businesses have already made investments in the area. While the market might appear saturated and with other developments, with some good research, good knowledge of the land, its potential and any future investment plans by the local officials any investment can turn a profit.
For example, Koh Samui is one of the areas that has grown exponentially over the years due to investments. It seems to be an excellent idea to invest there as it became an exclusive location from just a backpacker’s beach a few years ago. Koh Samui now offers villas and apartments that are sought out by those who want to enjoy a luxurious vacation, something that was not possible in the 90s.
The second type of investment involves a lot more factors but also bigger potential for profit. Investing in up and coming tourist destinations requires any investor to do a lot of research and a lot of risk taking as regardless of how well prepared you are before making such an investment, you can never reduce the risk factor to zero.
To begin with you will have to study the geography of your chosen touristic destination and find what will help increase its attraction and what could possibly make it into the next big thing. Once you established your budget and your location you need to remember that a big investment doesn’t necessarily mean big returns. Think about the possibilities of the plot and never go too far with your investment.
Another thing to remember is that increased tourist presence will make surrounding properties’ value to sore so if you plan to make several investments in the area make them before the destination start growing as you will pay a larger sum. While it might be considered a gamble, the payback far outweighs the risks.
You also need to make sure you don’t fall far an opportunity to invest in an extremely famous tourist destination. Just because the location of your investment is well-known it doesn’t mean that high profit will follow. In fact, as tourism seems to be heading toward a more alternative direction with travelers asking for something that breaks the already well-established patterns of conventional tourism the profit possibilities in over-popular destinations is also dropping.
There is no better time to invest in property in areas that offer something new or a new perspective on the tourism industry. Just make sure you apply the same rigor and research you would in any investment and don’t fall prey to the possibility of being the first to get a piece of a yet untapped market. Caution, courage and cash is the key to making a wise investment, regardless of its nature.