Yet another post on Land Banking

Last year, I made at least 2 posts on Land Banking and its so-called "dangers" in this investment. My previous posts are Land Banking - Read This First and 3 Land Investment Companies in Malaysia Raided.

Despite many independent reports by free press in countries practising freedom of media (excluding Singapore) on such investment product, many are still going for Land Banking without doing their homework. I am here to say SOME and NOT all lands are not worth investing, so please do not prosecute me and put me behind bars.

Today, I saw TV adverts on land banking on today's news. I hope investors interested in Land Banking to do their due homework, making sure the plot of land they are investing in will really one day have buildings on, and investors to be familiar with local property tax laws and regulations.

An article published on February 2009 on Guardian.co.uk mentioned the perils of Land Banking.

Don't bank on this land for making a profit

"A company called Profitable Group is offering UK land for sale here in Singapore on TV adverts. The deal is that you buy land without planning permission - they are selling this in Colchester and Hounslow - and wait a little while until its gets the local authority go-ahead when it will become very valuable. As it is very hard to find out information here, can you tell me what you know about Profitable?"
CC, Singapore

This is landbanking - a get-rich-quick scheme that has never delivered except for the promoters, who can multiply their investment in land many times over - £10,000 an acre agricultural land is sold for £100,000 by landbankers.

Profitable's Colchester land is protected by a covenant preventing resale at a profit, so planning gains would be difficult - and currently house demand is so low that builders have an over-supply of both homes and land.

Profitable also claims interests in sport and recruitment. Former Scottish footballer Kenny Dalglish is listed as an executive on its sporting side.

The main board of this Singapore-based company also includes Tim Goldring, John Nordmann, James Hodgson and Nigel Blanchard, who were also directors of UK-based Profitable Plot Company. This went into liquidation last year after failing to produce accounts and, after three years of landbanking, sales in the UK did not produce the big gains promised.