The above quote from George Washington has been widely circulated, at least in the real estate world, as just another proof that it is always a good time to buy. Somebody handed me a copy of the letter yesterday, and as I was reading it again, I wondered: didn't some of our founding fathers lose their shirts in land speculation?
The short answer is yes; most noticeably Robert Morris, Henry Knox, and James Wilson. It turns out that George Washington was actually very successful in the land speculation business. More on that story can be found in this longish and well-footnoted essay. Wee excerpt here:
Speculation in land became particularly rampant in the early 1790s when the stability of the new republic seemed assured. Describing the process of speculation, historian Forrest McDonald wrote: “One worked or connived to obtain a stake, then worked or connived to obtain legal title to a tract of wilderness, then sold the wilderness by the acre to the hordes of immigrants, and thereby lived and died a wealthy man. Appropriately, the most successful practitioner of this craft was George Washington, who had acquired several hundred thousand acres and was reckoned by many as the wealthiest man in America.”
I believe the lesson to be learned from our Founders' experience is that investing in land is a smart, profitable, and worthwhile endeavor; but, one should do it without also acquiring a significant amount of long-term debt. A timeless lesson.
Subscribe to:
Post Comments (Atom)
Posts
No comments:
Post a Comment