People invest in timberland for various reasons including their enjoyment of the scenery, hunting, outdoor recreation, conservation, and passing the land on to their heirs.
What’s So Great About Timber?
Timber is a longtime favorite of some of the top investors in the world namely for its ability to stand the test of time in spite of the ebb and flow of the markets. This makes timber a suitable long-term investment. Timber is also an attractive investment because it performs well during inflation, and unlike crops, it doesn’t need to be harvested every year. Even if the price of timber is unfavorable, forests can grow aggressively on the stump for years allowing the investor to sell when pricing is more favorable. Timber is also a sustainable, renewable resource that can be replanted and re-harvested time and time again.
What to Look for When Investing in Timberland
Great timberland tracts have key characteristics. For one, The property’s soil should also be productive enough to grow profitable timber species. You should also be able to log most of the property. Additionally, you should seek property that can be purchased at a price that allows for a good rate of return.
How to Invest in Timberland
One way to invest in timberland is to purchase shares of timber-related publicly traded stock (i.e., REIT or ETFs) which doesn’t require a large amount of capital or active management of the timberland. Publicly traded stock also offers high liquidity. You can also invest in timberland but leave the management to a forester.
Investing in timber requires patience since maturity is a major factor in profit. It will take the expertise of a knowledgeable forestry group to ensure you are purchasing timberland for sale in Florida at a great price and that your investment is a successful one.