Ever appreciating value of farmlands and the yields it earns has always excited investors to invest. And with recent amendments in Karnataka Land Reforms Act that allows any individual to buy agricultural land in Karnataka, regardless of their background, many big developers have catered the open market.
And now enters managed farmlands. These are farmlands where people can place their cash in a farm plot and afterward watch their resources grow without the issues of overseeing it themselves. In other words, managed farmlands are simply those that are held by individuals or institutions but are managed and taken care of by a professional organization. As for individuals with different career goals and non-farming backgrounds, managing plantations and farms might seem challenging and time-consuming, hence enters professionals, even farmland developers, who are providing services at reasonable charges.
Unlike mutual funds, stocks, F&O, etc; farmlands and real estate assets are not mainstream assets but still are quite popular among new-age investors. This gen investor loves to own a house and wants to live all organic, hence, are equally interested in owning a farmland. Professionally managed and secured farmlands with fertile land, enough open space, adequate groundwater supply and engrossed amidst nature are becoming valuable assets and is also an ideal option to diversify your portfolio.
Whether managed farmlands are more beneficial than real estate is still a debate but here are some pointers one must know to understand the benefits of farmlands over real estate.
1. Different source of incomes:
While investing in real estate, you invest in land which tends to appreciate with time. When you invest in managed farmland, you earn appreciation value and cyclic value from the yields produced on your farm.
This creates an automated revenue cycle that likewise liberally adds to the environment by keeping it green
2. Tax free income:
In India, the return on investment in agricultural ventures is tax-free. According to Section 10(1) of the Income Tax Act of 1961, Indian citizens are not required to pay taxes on their agricultural income, including the profit they make from selling the produce produced on these farms. This not only empowers farmers and farmland owners but also creates a hedge against inflation.
3. Grow your organic food:
A farmland provides you with an opportunity to grow your own food. In today’s world when almost everything you buy from market is adulterated, the demand for organic food is at its peak and so are its charges. With a managed farmland investment, you can try your hands in farming under professionals and bring healthy home grown food to your family. You can also gift or sell the excess produce for more returns.
4. Higher ROI:
Compared to conventional assets like fixed deposits and some bonds, farmland offers much greater tax-exempt returns on investment (11% to 17% p.a.). As a result, the investment allows investors to generate passive revenue.
5. Portfolio diversification:
Since farmland is a new non-market-linked, low risk and competitive return asset class , it offers an excellent opportunity for investors to diversify their portfolio and balance out their riskier market-linked investments like mutual funds, ETFs, stocks and bonds.
6. Environmental Importance:
The pandemic surely has caused individuals to think and focus on physical and mental wellbeing over hectic and chaotic work life. Money surely has importance in each one’s life but investing that money intelligently for the wellbeing of oneself and for the environment is what people have landed to.A farmland is that investment that serves human health and environmental health.
7. A break from city chaos:
If not anything else has convinced you to invest in a farmland then this may do. Managed farmlands work as a much needed weekend break from your hectic, boring and polluted lifestyle to a clean, tranquil and pure living. You can build a weekend home here to break daily monotony or choose WFH while staying close to nature. The casual environment in the laps of nature gives a break from the busy life.
Triguna Country Homes is a 100 acres farmland community near Bangalore. Triguna offers land measuring ¼ Acre to 1 acre, that is fertile and has healthy water availability. Moreover, each plot comes with a personal mini Miyawaki Forest, indeed, is helping and protecting nature. Each forest comes with around 450 native plants including Mahogany, Sandalwood, Teakwood and many more.