It is often said the best investments are long-term, meaning a truly prudent investment pays off across posterity. Alternatively, investments made for short-term gain are akin to risky gambles. Commit to long-term investing and your patience will pay dividends in due time. Let’s take a look at the top ways to identify the best long-term investments and why farmland investments fit the criteria necessary to qualify as a potentially lucrative long-term holding.
Consumer spending is decreasing as a result of the pandemic. People are paring back their spending on most items, except for food. Food is a necessity that will always sell, regardless of the economy’s health. The ingredients necessary for food are grown at farms. The price of food at your local grocery store has increased in recent months, partially due to hoarding and supply chain issues. Even if demand for food eventually dissipates and the supply chain kinks are worked out, it will still be a valued commodity. As a result, farmland will either appreciate in value or at the bare minimum, hold its value across the long haul. In fact, the Food and Agriculture Organization of the United Nations (FAO) reports food prices have increased 100% in the past 17 years. If this trend continues, it bodes quite well for those invested in a successful farmland operation.
The law of supply and demand illustrates why farmland is a solid investment across the years and decades to come. The current global population of seven billion is likely to expand to nine billion across the next couple decades. However, the FAO insists the planet’s arable land will decrease by a considerable margin in this period of time. The elevated demand for food combined with the reduction in space available to farm will inevitably make farmland and its crops that much more valuable. Furthermore, rising income levels in second and third-world nations will increase the consumption of meat, necessitating a hike in crop yields at farms across the world. Livestock require considerable amounts of grain, meaning food production will be ramped up accordingly at farms. Add in the skyrocketing demand for the biofuels created with corn grown on farms and the stage is set for farmland to significantly increase in value as time progresses.
The minimal risk of a farmland investment combined with hits comparably high return makes it a low-risk, high-reward investment. In short, there is little downside to a farmland investment. Farmland will continue to generate crops that are in demand across the globe. The bottom line is people will not stop eating meat, corn, fruits, grains and vegetables. While commercial real estate, residential real estate and stocks will undulate amidst an uncertain economy, farmland is likely to hold strong in the years ahead, generating steady returns even if there is a lengthy recession or depression.
It is clear this is the optimal time to invest in farmland and FarmFundr makes the investment process simple. We focus on high profit potential, domestic specialty crop operations. Exploring these opportunities is simple. Sign up for a FarmFundr account, determine the farmland investment best for you, easily invest in just 3 steps, then monitor your farmland investment in your farmland investing dashboard. Click here to create a complimentary FarmFundr account and begin exploring available farmland investment opportunities.