Playbook #037: Farmland
🖼️ The Big Picture
Farmland has never been so hot. Bill Gates made headlines in 2021 as he’s now the #1 investor in farmland in the U.S, acquiring more than 269,000 acres across 20 states in the last 10 years. And there are some really good reasons why.
Like other real estate, farmland rises during inflation. It’s a hard asset, and there’s a finite amount of it. Unfortunately, we’re losing more of it due to urban encroachment, deforestation, and wildfires. So the simple forces of supply and demand should continue to make it more valuable over time.
Also, the P2P (peer-to-peer) lending space and technology have made it more accessible to individual investors. Similar to how you can invest or loan small amounts to entrepreneurs or in apartment building deals, with AcreTrader and FarmTogether you can invest as little as $15,000 (depending on the deal) over 2 - 20 years for a share of equity and cash flow in the deal.
Once the land is purchased, it’s leased out to farmers, which is where the cash flow and returns come from (along with a sale at some point).
Land has produced enormous wealth over generations with positive returns every single year since 1990, and is a strong long-term investment that is worth a good look at.