Over the years, timber has proven to be a safe and steady growth investment when compared to most other investment vehicles. This applies especially to teak, thanks to its many strengths in the more tropical climates. With the North American market being as unpredictable as it currently is, those looking for a solid investment might want to consider teak as an option.
What’s So Special About Teak Hardwood?
Teak, sometimes called Burmese Teak, is a tree native to only four countries, and due to heavy deforestation, is growing scarce. Its native countries are Myanmar (formerly known as Burma, hence the nickname), Laos, Thailand, and India. These climates are tropical, which means teak can also be grown in Latin America. That makes re-populating the tree an especially attractive endeavor for those looking for something valuable in which to invest on this side of the world.
What makes the wood itself so special is its resistance to damaging elements such as rot, fungus, termites and other damage-causing insects.
It’s the wood’s high oil content that helps boost its weather-resistant qualities, making it an ideal material for building things such as doors, windows, boats, and decks.
Why it’s a Solid Investment
When choosing a medium in which to invest, it can sometimes be daunting to try and find something with a low risk factor. That’s especially true when it comes to fluctuations in the United States market. There are only so many options for investing that have proven over the years to be consistent and reliable. Teak is one of those options.
The ultra-wealthy have known about this investment option for years and have profited off of it as a result. Thanks to the low risk factor and the high value of this particular hardwood, its investments have also been known to bring generational wealth, allowing those investing to relax with the peace of mind that their families will also benefit from such an investment.
Investing in teak in Central America means owning a plot of land, on which you’ll see your investments grow. The trees follow a 25-year lifespan, and once that time is up, you can choose to re-plant on your plot and continue the growth of your investment. This is why it’s such a great investment for generational wealth. You can continue growing the wood for years to come and its use doesn’t diminish, therefore its value hasn’t diminished.
Planting Teak Hardwood and its Effect on the Environment
There are more long-term benefits to growing teak than simply the financial ones. This is a very different kind of investment than what is typical for most portfolio-building ventures. In this one, you can also help with reforestation efforts. The teak wood is ideal for building weather-resistant structures, so it will always be of good use. That means that continuing to plant it can only help, both the environment and the people who use the structures built from it.
With the heavy deforestation of the valuable wood in its Asian countries of origin, planting it in large quantities in Central and South America can only serve to help the environmental cause. This is especially true when so many investors choose to continue replanting after each 25-year span.
This method of growing and harvesting the wood allows it to be taken from the farms themselves rather than losing rainforests and important wildlife habitats due to the need for wood for building. That’s why it’s such a green investment option.
Panama Reforestation Visa
It’s common knowledge that many countries in Latin America offer residency programs through investment efforts. However, one country in particular offers a permanent residency program for investing specifically in teak hardwood – and that’s Panama.
In order to qualify for such a residency, you must invest $80,000 USD by way of a reforestation project that is certified by the Panamanian government. This investment would include 5 hectares (a little over 12 acres) of land on which the teak trees would be grown.
In return for making this investment, Panama offers permanent residency to the investor and the investor’s dependents. After five years of permanent residency, you can apply for citizenship. That’s a highly profitable way to achieve two goals if you’re already looking for a strong means of investment and for a new life in South America. Teak investment and reforestation have been known to bring a two percent annual return, which would total $370,586 after the 20-year growth period of the trees. Allow the investment to continue, and you can see how this would be an advisable way to create generational wealth.