06/01/2004
A popular writer of the Southern Gothic potboiler once wrote that “Land is the only thing in the world that amounts to anything, for ’tis the only thing in this world that lasts.”
Perhaps we can agree with her first premise: As assets go, land is incomparable. Over the course of history, we have killed for it, coveted it, horded it, mourned it, rhapsodized it and even named it, as if it were a family member. Given land’s obvious power over our emotions and our actions, perhaps it truly is the only thing “that amounts to anything.”
As to her second premise, that land is the only thing in this world that lasts, with America’s current economic and demographic realities in mind, we must politely disagree. As suburbs creep and populations swell, land—particularly the large, open tracts that have defined family wealth over generations—is quickly becoming too valuable to “last” as a passive, yet emotionally evocative, family asset. Interest rates are at 40-year lows and property values are at all-time highs. Consequently, the real-estate market is the hottest (some say the most overheated) game going. As housing values and returns on securitized real estate soar, even those of us with the most abiding emotional attachments to our properties are forced to see those properties as assets of enormous financial potential.
In the following pages, Worth examines land and real estate in both financial and emotional contexts. First, we look at the current hyper-paced real-estate market, and at the confluence of factors that have created its dizzying, uncertain state. We then turn to the practical matter of leveraging our real-estate assets. We examine how, through careful planning and strategic development, we can reconcile the goal of financially optimizing our only asset “that amounts to anything,” with an almost primal desire to make that asset “last.”