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> It's quite simple. If you own land and other people manage it, you just collect a paycheck from the land without any impact on its profitability. In many pla
by kodablah 9y ago
> It's quite simple. If you own land and other people manage it, you just collect a paycheck from the land without any impact on its profitability.
In many places in the US, due to property taxes and other things, land is a burden that you will spend your paycheck on, not collect it from (until you sell). Granted if you are using the land for something profitable you might collect on it, but rarely is that use passive (often only if you have mineral rights, even e.g. landlords in the multifamily industry have to work to maintain livability conditions). Using others to manage the land rarely maintains an inherent value to keep you wealthy, at least in the US.
- EADGBE 9y ago> Using others to manage the land rarely maintains an inherent value to keep you wealthy, at least in the US. Property maintenance contracts aren't nearly as expensive as you might think they are. Even with a mortgage, property taxes, maintenance cost and equipment upgrades, one can still come out on top with a profit margin. *This experience is based off of single-family units, though I may have misunderstood your "land".
- kodablah 9y ago> one can still come out on top with a profit margin Agreed, but that's rarely extreme wealth. The GP seems to point towards a more feudal situation which, at least on this side of the pond, doesn't seem to exist. And while land may be a primary inheritance mechanism, most significant gains are realized only after sale.
- ameister14 9y agoThat's not accurate in my experience. I know about a dozen families that have multi-generational wealth maintained in large part through physical property holding and rent/leasing. They are all in cities, though; Cincinnati, Miami, NYC and LA - perhaps that's the difference?