It sounds like the perfect deal - buy a piece of the English countryside, apply for planning permission and sell it on to developers for a huge profit.

But scores of investors across the country have been tricked into handing over thousands of pounds for land that has no chance of ever being built on.

(Via BBC News. To read the full story, click here)

Randeep Ramesh in New Delhi

Plots of green belt land in England are being sold to Indians for thousands of pounds as one of the best ways to make money. They are being marketed on the basis that vast tracts of the English countryside would soon be covered in homes - and potentially make big profits for foreign investors.

Companies have taken out full-page advertisements in Indian newspapers and also blitzed prospective customers with text messages saying: "Plot available in UK London (sic)". Investing in England's green belt, according to marketing material seen by the Guardian, is "one of the best ways to create real personal wealth".

Landbanking firms typically buy fields for a few thousand pounds, divide them up, and then sell plots for £10,000 each on the basis that, with planning permission, they stand to reap substantial profits. However, local councils told the Guardian that "allowing homes to be built on the land would be contrary to all current, emerging and foreseeable planning policies".

In India, landbanking firms are largely unregulated, although some have been closed down. In London, the Financial Services Authority is concerned some schemes should be controlled because they are "collective investments".

(Via Guardian Unlimited. To read the full story, click here)

For years, land banking has been a solid and rewarding investment. It has reaped big dividends for big-names such as Bob Hope and Howard Hughes right down to small market-gardeners on the fringes of growing cities. All over the world people have got rich.

The investment theory is simple. Just buy a largish parcel of rural land – usually a few acres – as close as possible to a spreading urban sprawl. And wait a few years.

One day, the land will be needed for houses and, presto, its value will increase ten-fold – even more. Suddenly, you're a squillionaire. If you're lucky, you may have enough life left to enjoy your new-found riches.

Yes, land banking requires patience. Investors can die waiting. The cost of holding the raw land can also be crippling. Nevertheless, if income productive land can be found or if its cheap enough, land banking may be an excellent investment.

Provided you avoid the latest rash of conmen who are ripping-off thousands of small investors with their dodgy land-bank scams. All over the world people are getting ripped.

Via The Jenman Group.
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