Investors in India are moving towards buying Farmland as an inflation hedge

Investors in India are moving towards buying farmland as an inflation hedge

In India, agro-realty has the potential to alter the agricultural environment drastically.

In its most basic form, Agro-realty refers to the development of clearly defined and delineated land parcels from enormous tracts of land to sell to persons who can subsequently receive returns with minimal work. As a result, developers buy a large plot of land in agro-realty, divide it into sub-plots, and sell them to investors looking for a high return on their investment.

The advantages of agro-realty are numerous. The main benefit is that the overall cost of developing a property is shared among the farm land’s final owners, which is usually a fraction of what buying the entire site would cost. This expense of expansion involves obtaining water, constructing roads, preparing the land, utilizing scientific agricultural practices, and increasing the number of people working on the farm to maintain the vegetation. As a result, several agro-realty companies urge ultimate farm property owners to create cooperatives to reduce marketing and production costs.

Agro-Real Estate Investments in the Post-Covid-19 Era

Although agro-realty is a relatively new notion in India, it has been present in Western countries for quite some time. People in the United States and the United Kingdom invest in agro-realty to benefit from growing edible fruits and vegetables while also supplementing their income. Over the weekend, it even becomes a recreational venue for some. It’s not uncommon to build a house on the site because it already has all necessities, such as running water, electricity, and paved roads. Farm investment is a safe place to put one’s money because the return on investment is usually better than average and the money is safe.

In India, agro-realty has the potential to alter the agricultural environment drastically. As public health and safety concerns develop due to the ongoing worldwide pandemic, more individuals are opting for organic foods. Many people are concerned about using large amounts of chemicals in food production. As a result of this shift in consumer behavior, many people want to switch to organic farming, which will necessitate the purchase of more land.

By 2022, the global organic food and beverage industry is expected to reach USD 327,600 million. More than half of this market share is predicted to come from organic fruits and vegetables. People are becoming more aware of the importance of maintaining the earth and its limited resources as the global population expands at an unprecedented rate and global warming continues unabated. Organic farming has evolved as an effective means of preserving the environment, and with the globe being turned upside down by the coronavirus epidemic, this trend has accelerated. Even well-educated young persons with more discretionary wealth are looking for methods to contribute to environmental improvement.

The Top Reasons to Invest in Agro-Realty

The subsequent are some of the significant benefits of agro-realty:

Land at a Lower Cost

Because the land development costs are shared among all investors, the price of the furnished plot is substantially lower than what each owner would have paid individually.

Exceptional Return on Investment

Investing in agro-realty allows you to make money with less work and risk. Compared to stock market or mutual fund returns, the long-term return on investment in agro-realty is significantly higher.

Home for the Weekend

Because the property has all of the required utilities, such as constant water and power supply, it may even be used as a weekend getaway for family and friends.

Non-depreciable Asset

Unlike residential properties such as flats and apartments, agricultural lands do not depreciate with time. Agricultural land does not decrease in quality. Hence there are no maintenance fees associated with it. Along with saving money, agricultural land can be used for various purposes in the future while remaining legal.

Final Thoughts

Overall, it is safe to assume that real estate farming has enormous potential for individuals who are passionate about organic farming and desire to purchase modest farmlands to do so. Agricultural land values, on the whole, are supported by the income generated by the asset. Debt-to-asset ratios especially stay down in the agriculture sector corresponded to other real estate categories.

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