Something on Land Banking

What's Land Banking? Its the practice of purchasing raw land with the intent to hold on to it until such a time as it is profitable to sell it on to others for more than was initially paid. Land is popular as an investment as it is a tangible asset as opposed to shares or bonds.

The intended increase in value may come from inflation, conversion for use as housing, or potential for extraction of raw materials.

Typically parcels of land desirable for land banking are those that lie directly in the growth path of rapidly developing cities. The initial goal is to buy undeveloped land that will increase in value because it lies in the path of urban growth. The investment objective is to identify these parcels well in advance of the developers and wait for the value to be realised.

Lately, I've received a few called from Walton Group requesting for a meetup to promote land banking concept as a form of wealth growing tool. The concept of owning land and selling it for profit is as old as the hills, but with the potential to achieve spectacular returns, this is only achievable if the land is approved for planning and development. This may be 3 years, 5 years, 10 or even more years down the road so a long term view should be taken. At the end, if the land did not get its approved for planning and development, your investment just hata-kaki there. So what different would it be putting the same amount in the Fix Deposit?

Walton is to date the most well-known of the land-banking companies in Malaysia and have offices in KL and Kuching. According to their website, Walton focuses on “the purchase of strategically located raw land in the path of development of major North American cities”. Walton manages 22,500 acres, predominantly in Calgary and Edmonton, on behalf of over 35,000 investors worldwide. There’s no mention of what type of returns to expect on their website, and I’ve read widely varying percentages from trawling the forums. However, they appear to be aggressively growing their presence in Malaysia & Singapore with two offices and a sizeable team of local consultants.

Every successful scam needs a remarkable event to back it & I hope that with the limited land they have, they won't "over sold" the land just to get more investors. Investing in land to me is more risky than in stocks. Although stocks shock is deadly, but you still have time to recover (Time = Money), but in land, when the shock came, you may not have the time to recover. You might want to checkout the Complaints Board, the Walton International Complaints Threats & Real Estate Talks before investing in it.