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Smart investors know that using a number of different investment vehicles is a sensible way to invest. Whether it is property, stocks and shares, pension funds, business stakes or savings plans, it's a good idea to spread your money between a number of different options. If this is the way you invest, then think about adding land to your portfolio.

What can land do for me?

The right land in the right place can provide you with a great return on investment. In the UK, increasing demand for housing over the next ten years will make certain types of land very desirable as new developments are needed and builders and the general population look to sites further out from town and city centres.

How do I know which land to choose?

Unless you have a lot of money to invest, you won't be able to buy a large piece of land. Small private investors can buy parcels of land from investment firms, who have taken the time to research the available land and have chosen to buy land that they think is likely to be developed in the next few years. This selection is made by experts with many years of experience in land sales, and so the private investor benefits from their knowledge, without having to spend a long time researching the land themselves.

What length of investment am I looking at?

Depending on the land, it could be developed into housing or business premises in anything from two to ten years. Your land will probably increase in value over this time anyway, but the real profits come when development planning permission is granted. Once you have bought the land, you can sell it at any time you choose, but you will realise greater returns if you wait until building permissions come through.

Land is an excellent addition to your portfolio as a short- to medium-term investment. The potential returns make it an investment that's worth further investigation no matter how much you have to spend.