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When the term raw land is mentioned in the real estate industry, it refers to land parcel(s) in it’s unused natural state with the absence of added improvements, site development, landscaping or infrastructure, etc.
Sometimes also called undeveloped land or unimproved land, it basically refers to any piece of land without any man-made construction or improvements whatsoever.
These types of land are sometimes the subject of land investment schemes where promoters travel around the world selling stakes in the land in exchange for financing to develop it into some sort of residential estate or commercial hub.
However in recent years, various land investment schemes that target consumers have turned out to be lemons.
Even though raw land might appear to have little value, especially when it’s a plot located in the middle of nowhere, they and sometimes turn out to be shrewd investments in the long term.
For example, one day an energy exploration company might find natural resources underneath.
And at a low entry level, they can sometimes turn out to be very good investments for the average investor.
This is why owners of raw land make regular inspections on the land area. This is to ensure that everything is in order and that there are no adverse possessors on the property.
When purchasing raw land, one should be mindful to conduct extensive diligence research on issues such as:
- Environmental factors
- Soil study
- Clear title
Raw land should not be confused with vacant land which describes land that is merely not in use. Vacant land can have utilities, improvements, roads, buildings, constructions, etc, on it.
The opposite of raw land is improved land.