For hundreds of years in this country huge fortunes have been made in land. You buy a piece of land in a remote area that you believe is headed for growth and expansion and you sit on it. A wealthy developer comes along and offers you many, many times what you paid for it. That is the lure of investing in land.

But before you go out and invest your nest egg on that piece of property you are sure is ripe for profit you may want to consider the following:

1. Land as an investment is hard to monetize. In general land purchases generate no income and at the same time incur ever-increasing property taxes, thus creating a negative cash flow. So while you are waiting for your ship to come in you are losing money every year on your investment.

2. There is no depreciation allowed on raw land for federal income tax benefits.

3. Development of land is regulated by the municipality in which the land is located. Where land subdivision and development used to be not much more than a formality, it has become increasingly arduous to get approval, mainly because of tighter environmental restrictions.

4. Raw land is the most illiquid of all real estate investments. It can literally take years to sell some parcels - others may not be marketable at any price.

5. It is very difficult to get traditional financing or borrow against equity on land.

While opportunities for profit still exist, most financial advisors generally advise against land purchases for almost all independent investors; saying that it is, at best, a place to invest only money that you’re quite sure you won’t be needing anytime soon. As always, it is prudent to consult your professional advisors before making any significant investments.