Farmland investment s that can make you a millionaire in 2017
Farmland investment is a lucrative business with a very high turnover. We eat food everyday and it is an important aspect of our lives . Since sustainability of lives depends largely on food , it is investment wise and sensible that inves tors should key into agricultural /farmland investment s .
Inflation is one of the main reason why investors must diversify to agricultural / farmland business . The prices of farm products in Nigeria are growing at a very high and astronomical rate. The current inflation rate of food items in Nigeria according to CBN report on her website is 17.82 %. Investing in agricultural/ farmland business is just another way to fight the high cost of l iving. F arming has the added benefit of producing goods and generating income.
As fo r investment returns , the following are some of the ways to make money on a piece of farmland by investors ;
1 . Capital appreciation and income on acquired farmland
Capital appreciation means if the value of the land goes up then the investor can sell it for a profit. The rate at which prices of food skyrocket in Nigeria has lured many people to farming and the more people that are going into farming the higher will be the value of farmland because of law of demand and supply. One of our clients purchased an expanse of land at N40,000 per acre in Ogun State early 2016 and after some months , he sold it at N 70,000 per acre. This is 75% gain within months of purchase in the same year . It is our advice that before anybody ventures into acquisition of farmland , he should equip himself with prerequisite knowledge regarding acquisition of landed property by reading ‘ 7 reasons you must do search before buying farmland in Nigeria’ and ‘6 real reasons why prospective buyers fall prey to property scams’
2. Lease
Income from farm land could be generated on lease by the lessor in the following ways viz:
- Cash rent,
T his is the agreed amount of money paid by the lessee to a lessor on a rented piece of land annually. Cash rent is calculated by naira per cultivated acre. This is a situation where an investor purchase s a vast expanse of land and then lease it out to farmers who in turn will pay agreed rent on the land every year. At the same time the land will be appreciating.

- Crop share.
This is an alternative t o cash rent. Crop share is an arrangement between lessor and lessee of farmland where after the crops are harvested and sold , the farmland investor/owner gets a share of the total sales, usually about 30% to 4 0%. In most cases crop share makes more money for t he Investor/landowner , but it’s also riskier . If the farmer has a bad year for whatever reason (locusts, flooding, etc) then the landlord will share the burden. Cash rent on the other hand pushes all these risks onto the farmer because the Investor/owner still gets paid no matter what happens to the crop’s performance.

- Custom Farming
If the farmland investors have a background in agriculture they may consider doing something else called custom farming. This is when the landowner or investor hires a farmer as a contractor to operate the farm. Depending on the agreement the contractor could perform only certain tasks like swathing and transportation, or operate the entire farming process from seeding to h arvesting. The input costs like seeds and machinery is paid by the owner. The contractor just acts as an employee. The benefit of custom farming for land owners is they receive all the income from sales and have control over the entire farming process. But the disadvantage of custom farming is it puts the financial and management risks completely on the owners.

- Training Ground for farmers
Farmland investors could organize seminars and training for prospective farmers and use the acquired farmland for practical training field for his students. Certain parcel of land could be lease to each student for practical during the course of training. Farmland investors need not know anything on farming before he ventures into this area once he could organize the professionals that could anchor the programme.
- Price range of farmland per acre
The amount of farmland per acre in each state varies according to the distance of the farmland to the main towns and villages. In south western states, for instance, the price varies from N30,000 to N 500,000 depending on the proximity of the farm to the main town.
Farmland investments is one of the best business es one can invest in with a certain and high investment return in this recession period