You’ve heard the old saying: when it comes to land, they’re not making any more of it.
Of course, that's 100 per cent true.
However, despite the vast size of our beautiful country, valuable land in metropolitan areas is still a scarce – and scarcity drives up value.
So, as an investor, how can you make the most of your purchasing dollar and score a slice of this premium land, rather than sinking your funds into dirt that has little prospect of building your fortunes?
Look at the inner-ring suburbs 
There are always exceptions to the rule, but generally it will be the suburbs closer to the CBD that record the most solid, long-term gains.
As we have evolved from an agrarian to an industrialised society, rural locales haven’t been able to keep up with the price growth in the major cities.
After all, that’s where the higher paying jobs, amenities and services are located.
In many cases, the land under an older home or even under an established block of low rise apartments on a more valuable patch of land will be a better investment than a new estate further out of town.
There’s unlikely to be new patches of land available for release in the inner and middle ring suburbs, so this should help drive the value of your property higher, even if the dwelling itself is a little lacklustre.
Tangible assets
Factors like a low crime rate, good schools or a popular shopping strip can push up the price of a piece of land in the short-term.
However, it’s important to remember that these things can ebb and flow over time, and in turn so can the value of your property.
Don’t rely on these kinds of assets to ensure your land retains its value – instead, look for tangible factors that won’t be affected by the passage of time, such as proximity to water, amenities and good local infrastructure.
Proximity to water
It’s hardly surprising that studies have shown that being closer to water makes land more valuable.
It’s kind of obvious when you think about it – as our most precious resource, it makes sense that people don’t want to stray too far.
A US study found that being as little as one foot further away from the Colorado River basin lead to a 3.1 per cent decrease in property values.
Likewise research in Cardiff, Wales, revealed that homes within 50 metres of a lake were worth 16.8 per cent more than those in other locations.
The closer your land is to a body of water, the better, with waterfront views boosting the value the most.
Gentrification
Over the years industry has moved from the inner suburbs of our capital cities to the outer suburbs and many of the migrants and inner city blue-collar workers who lived there also relocated to the suburbs where they could buy a larger home with a sizeable front and back yard. 
The exodus of industry, migrants and many workers made way for gentrification of our inner suburbs where initially house prices and rents were cheaper than in the suburbs.
Later, our changing demographics with declining household size, in part because we we’re getting married later and having fewer children, meant that small inner suburban dwellings or apartments provided ideal accommodation for the expanding cohort of professionals who worked in or close to the CBD.
Gentrifiers were initially drawn to these inner suburbs by the diversity of jobs, educational opportunities and lifestyle – and this trend continues today as more and more Australians are swapping their back yard for courtyards or balconies.
Which land will be more popular post Covid?
Sure there's a trend to living further away from the CBD in locations that are a reasonably easy commute to the big smoke.
But in general most of us are going to want to live in the same capital cities we always have however being locked in a Coronavirus Cocoon has shown us the importance of our third place – our neighbourhood.
Third place is a term coined by sociologist Ray Oldenburg and refers to places where people spend time between home (‘first’ place) and work (‘second’ place).
They are locations where we exchange ideas, have a good time, and build relationships.
Social distancing during the COVID-19 pandemic made us experience many painful losses.
Among them were these so-called “third places” – the restaurants, bars, gyms, houses of worship, barber shops and other places we frequent that are neither work nor home.
If social distancing through coronavirus taught us anything, it taught us the importance of neighbourhood.
If you can walk out of your home and you’re in walking distance of, or a short trip to a great shopping strip, your favourite coffee shop, amenities, the beach, a great park, you will appreciate the benefit of the third-place – the importance of your neighbourhood.
While some people will move to regional Australia to have more space, the majority of Australians will want to continue living in our capital cities, but in lifestyle, destination locations which have great third places.
And it’s likely than in our new “Covid Normal” world, people will love the thought that most of the things needed for a good life could be within a 20-minute public transport trip, bike ride or walk from home.
Things such as shopping, business services, education, community facilities, recreational and sporting resources, and some jobs.
The bottom line... 
For as long as I’ve been investing the argument has been raging: regional Australia versus capital cities or inner suburbs versus outer suburbs.
Sure there are always exceptions – some better performing regional areas have exhibited more capital growth than some underperforming capital city suburbs and some high growth outer suburbs have grown faster than some demographically challenged inner suburbs.
But overall for strong, stable, long-term growth that outperforms the averages the inner- and middle-ring suburbs of our capital cities are the place to invest.
