Land – Why Ken’s Wrong

Land is where Ken Wheeler tells us he’s invested most of his money. Find out why his choice of unserviced, remote, vacant lots has been penny wise and pound foolish, and why his viewers should avoid hiring him as a paid land scout.

Middle-class baby boomers owe the bulk of their prosperity to investing in real estate. In most cases, this refers to their most valuable asset, their own home.

Home prices have appreciated dependably over the past five decades. Once a mortgage is paid off, homeowners free themselves of the burden of monthly housing payments.

Even during a mortgage’s term, families view the monthly payments as a kind of forced saving – a long-term investment in a secure retirement. In most jurisdictions, unlike other investments, governments don’t tax the appreciation in the value of someone’s home as a capital gain.

Home Equity Can Leave a Legacy

Many parents and grandparents view the equity in their homes as their legacy. They can pass their home down to leave the same kind of financial security to the next generation.

So, home ownership is a sound investment for most families. Ken Wheeler offers a very different view toward investing in land.

The Angry Photographer tells his viewers that he sold off half of his hoard of gadgets to fund his purchases of what he calls “raw land” in remote, depressed parts of eastern Kentucky, which has been the most economically disadvantaged region in America for generations. He even offers his services to help viewers scout out these kinds of low-priced, remote, unserviced properties as investments or for disaster preparation.

Buying “Raw Land” a Terrible Financial Move

This is a terrible financial move for many reasons. The main problem with buying unserviced rural land as an investment is the lack of demand and liquidity.

There are very few buyers looking for properties in locations with no economic development, infrastructure or amenities. This makes selling the property difficult and time-consuming when investors try to redeem their equity.

Also, unlike when homeowners sell their main residence, governments impose capital gains tax on investment properties. This cuts into any appreciation in value and complicates disposing of the remote, vacant land.

Land Doesn’t Automatically Appreciate in Value

Land doesn’t automatically appreciate in value, even though it seems that way to most homeowners in prosperous urban centres. Land prices rise in response to economic activity, population growth, urbanization, and infrastructure projects.

Unless those things happen in an area, land prices will barely keep pace with inflation. That means small investors can do far better investing in safer, insured, cashable assets at the bank.

Often, this kind of cheap, unserviced land in depressed regions even depreciates in value. Natural disasters, local politics and changing markets can lower demand for a remote, unserviced property, reducing its selling price.

Cheap, Remote Land Can Depreciate in Value

Owning vacant land also involves holding costs like property tax, maintenance and land management fees. These costs are actually higher in an underpopulated, disadvantaged area with a tiny tax base than they are in urban population centres.

All these drawbacks combine to create an opportunity cost for this type of so-called investment. The money sunk into bargain-priced, isolated land could be invested in other, more profitable assets that yield income, capital gains, or both.

So, as always, the Theoria Apophasis is being penny wise and pound foolish in his financial commentary to his viewers. His notions about so-called “raw land” as an investment simply make no financial sense for small investors with limited funds.

Personal Disaster Preparedness Strategy

Mind you, return on investment isn’t Kentucky Ken’s real motivation for snapping up these cheap, isolated land parcels. As he often explains, they’re primarily part of his personal disaster preparedness strategy.

Even so, this rationale for hoarding undeveloped land is even more wrong-headed than trying to claim his remote, vacant lots are sound investments. In the event of a societal collapse, these distant, empty properties would be useless to a survivalist.

Unserviced properties lack the essential resources a property owner would need to survive a catastrophe. These land parcels don’t offer potable water, food or any other kind of infrastructure.

Enduring Disaster on ‘Raw Land’ – Momentous Blunder

Without reliable access to food, water and shelter, trying to endure a major disaster stranded on “raw land” in the middle of nowhere would be a momentous blunder. It’s a scenario where the living would envy the dead, and not for long.

An isolated tract of vacant land in a depressed, unpopulated area offers virtually no community support, emergency services or law enforcement in the event of a societal collapse. A property owner would find themselves coping with threats and hostile individuals, with no protection. One lone man, even armed, wouldn’t stand a chance.

The isolation of these properties would leave the property owner in the lurch without community networks to share resources, skills or knowledge. Living alone without shelter in the middle of nowhere is not an effective plan for coping with the devastation of a major social disruption.

Geographic Distance – Another Fatal Flaw in Ken’s Plan

The geographic distance between Ken Wheeler’s properties in disadvantaged communities and essential services, medical facilities and supply chains is another fatal flaw in his plan. In a genuine societal collapse, transportation systems would be disrupted.

Roads would likely be destroyed or impassible, making it impossible to get medicines, food or essential supplies. It would also be impossible to evacuate the property as conditions changed unexpectedly, as they always do in disasters or chaotic social disruptions.

All these considerations mean that sustainable food production, running water, energy generation, shelter and even clothing access would be impractical if not impossible. Effective disaster planning takes access to resources, community support, collective security and mobility into account.

Fantasy Where Ken Proves His Critics Wrong

The Angry Photographer’s strategy ignores all of these critical factors. As we discuss under Preparedness – Why Ken’s Wrong, it’s all part of a fantasy in which Kentucky Ken is finally able to fire his treasured cache of firearms in anger, apply his supposedly superior wisdom and intellect, and ultimately prove his countless rational critics wrong about himself and his various ill-conceived notions.

Concerns also exist around Ken Wheeler’s paid land scouting activities. Being neither a licensed real estate broker or sales associate, in Kentucky or anywhere else, offering this service to his viewers seems sketchy to say the least.

Better Investments Could Have Provided Retirement

The money, time and effort the Theoria Apophasis host has expended on these worthless tracts of land in high poverty areas adds pathos to an already tragic life story. As noted above, many better investment options could have generated substantial returns and even provided Ken Wheeler with a comfortable retirement.

Instead, when the time comes to access the money he’s tied up in these undesirable properties, he’ll face enormous delays finding purchasers, tax issues, red tape and other complications. He could very well find himself losing money on the transaction, and so could anyone foolish enough to listen to his financial commentaries or land scouting recommendations.

Ken’s Evidence

Raw Land Tips and Expert Tricks
Raw Land Buying Secrets