<prompt> Human: Im considering purchasing land 12 acre that I would eventually build a vacation home on. The land is in a managed development has water, sewer, electricity has dues of 150mo for things like road maintenance has no timetable to build many places like this require that you build within a year or two has an architecture review process -- you cant build whatever you want e.g. min sqft requirement of 2400sqft. has rental management services will never be developed more than 20 the entire 10sq mile developmentMy plan would be to pay cash for the land and own it outright. Then save up money for a construction loan to build a home.My wife and I have stayed in this area 15 time over the past several years and love it. Its a short drive from our home 90 minutes.My main concerns at this time are as follows: Will the land appreciate over time? obviously cant predict this, but Id like this to be as low-risk as possible e.g. if we decide in 5 years that we want out, itd be nice to be able to sell the land and at least break even Will we be able to break even by renting the home out? Their rental management services seem great from what weve experienced during our stays. But Im not sure how to figure out demand i.e. what income could we expect How hard is it to build a vacation home? Getting a loan, working with a builder, working with the development, etc..Any advice would be appreciated. Thanks!  <response>: For me the 150 a month kills it right there. OP: Dig out your economics textbook or look one up at the library and calculate the present value of the current price of the land PLUS the present value of 150 a month for 20 years. PLUS the present value to build a home there. Reference: Time Value of Money, Cashflow charts.I sincerely doubt that any speculative increase in land value would offset the actual committment.Consider instead, investing the money with a tag on it to buy a retirement home. Alternatively, buy or build outside the managed development. Manage it yourself. Spend time there when its not occupied and do the maintenance and upkeep then. 