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"Don’t wait to buy land. Buy land and wait."
– Will Rogers

“Buy land, they're not making it anymore.”
-Mark Twain

"Land is the basis of all wealth."

-Adam Smith

Land Banking is the acquisition of unimproved land for the purpose of development or disposition at a future date.

Advantages of Investing in Land Banking
Attractive Return - If the land is in the path of development, the return can be outstanding. Out performing practically any other vehicle of investment. The key is due dilligence.

Portfolio Diversification - Land banking investment offers an opportunity that isn’t directly correlated or tied to the movement of other standard investments. This offers clients a unique opportunity to bring diversity to their portfolios.

Minimum effort by Investor(Dummy Investing)- No Service or management charges to pay. Just invest one lump sum and wait for about 3-6 years to reap the expected return. It offers a hassle free investment because you pay your initial investment, and you don’t have to think about it until exit. Very suitable for who do not have the time/education/patience to study and do research.

Land is a finite resource- The key to land investing is to buy in countries with a shortage of land and a growing economy and population that will make prime land locations rise in price as they are developed.

Disadvantages of Investing in Land Banking
Minimum liquidity – You are expected to hold the investment minimum for 3-6 years for the land price to appreciate. Early exit will result loss.

No guarantee on Exit - Companies operating these schemes are seeking investors to buy plots of land in areas which HAVE NOT YET been granted planning permission. There is no guarantees on how soon developers will buy over the land. Estimates by landbanking companies range from a period of three to eight years, to five to seven years. Basically the companies will apply to convert from agriculture to Commercial land status from the Government. Government may changed their policies anytime.

Land is located Oversea- You do not know the real value of the land, except the promise of the marketer that no investor had sold the land at a loss.
Land banking is unregulated , and thus falls into a legal grey area. This could pose problems if disputes arise between companies and individual investors. You cannot complaint to Bank Negara Malaysia(BNM) for dispute as land banking is not under its purview. In November 2006, UK landbanking company, Land Heritage (UK) closed down after an investigation by the Financial Services Authority. Its 700 investors were not refunded.
There is NO perfect Investment . Therefore Investors need to do their due diligence before investing.

http://www.wisegeek.com/what-is-land-banking.htm

http://en.wikipedia.org/wiki/Land_Banking

http://www.proland.com/land_banking.htm

http://alantanblog.com/investment/land-banking-secret-recipes-to-wealth.html