The Pros and Cons of Buying Property in a Rural Area
Rural properties can provide a respite from fast-paced and loud urban locales and enable you to enjoy the vast outdoors. For these reasons, many people invest in a rural home for their retirement. If you’re considering purchasing a rural property, it’s important to do thorough research before making your decision.
Consider the pros and cons of purchasing a home in a rural location. Let’s start with the cons first:
Limited Public Services
If the rural population is lower, you may not get the same quality and variety of public amenities as in large cities. Therefore, you need to set your expectations accordingly and prepare yourself for a bit of extra effort and hardship.
Restricted Economic Opportunities
A rural property is generally a long-term investment as the market and economy are smaller in the region. You may need to wait for a long period to lend or sell your property since business opportunities are limited.
Not Much Tourism
Compared to an urban property, you may not get much monthly rental income if you make your rural home an Airbnb pad, for example, since there are typically less visitors to rural areas. Therefore, it’s not always a smart move to buy a rural home as a rental investment due to the lack of tourism spots, fewer services and amenities, and lengthy distance from cities.
Additionally, you should check the following things when buying a rural property that are usually issues for a public property:
- Land usage permissions that restrict what you can or cannot do on your property
- Legal requirements about animal or weed control
- Water or land contamination that could lower the value of the property
- Pests and access to exterminators in the region
- Historical information on plant and livestock diseases
- Water sources to tackle potential cases of bushfire or drought
As vendors may not provide this information, you should confirm with your property broker if you can review these items before bidding on a property.
Many investors appreciate rural properties because there is an array of choices available including countryside ranches, mountain cottages, farmhouses, lake houses and more. Urban real estate generally has higher demand and return. However, rural properties also attract many investors who are able spend less money, pay lower taxes, and buy more properties.
Now let’s look at the advantages of purchasing a rural home.
Big cities typically have more limitations on property development compared to rural regions, which enables rural property proprietors to exercise more land development options. They can also freely list their property without needing to meet the strict home listing regulations that are mandatory in large cities like Los Angeles or New York.
Development of Land
Rural regions permit investors to buy several properties and provide them with more expansion opportunities. You can buy a countryside property as a long-term investment plan since the land value should increase. Furthermore, you can potentially sell the land for a tidy profit if you choose not to develop it.
Significantly Lower Prices
The average price of a rural property is typically half that of a city property of similar size, which enables you to buy multiple properties simultaneously with a relatively small budget. A main reason for the comparably lower prices is the absence of competition.
Less Demand and More Supply
There is an increase in the number of available rural properties, but there is not much demand from investors, which means competition is minimal in this market. Consider a home in a rural area so that you can enjoy the peaceful life without worrying about living in a big city.
Rural homes present a lot of opportunities that you can’t find in the city. However, it’s important that you do thorough homework and avoid some common drawbacks. Before you submit a bid, perform due diligence and get to know about any issues that could possibly derail your investment in the property. Review all the numbers, and check potential risks if you decide to move to a rural property.