Buying a property is a tricky task. First, you have to save for years and then rack your brain to decide what to buy – a plot or a flat. After all, it is only right to expect a fair return on your hard earned money. So, let’s put an end to never ending debate of whether one should invest in a house plot for sale or a flat, once and for all. To start with, both the investments offer advantages of their own. But there are a few significant factors which can enable you as an investor to make the right decision.
You can buy a plot available for sale or a flat depending on your investment goals, the cost of building, appreciation, financial assistance and income. The tricks lies in realizing what you expect out of your investment – regular returns or high appreciation over a certain period of time, and then match it to your investment capability.
So, let’s delve into the details and see what makes more sense: –
Effort Estimate
While buying a plot for sale, you have to plan the entire construction, hire an architect, take permissions from the local bodies, arrange finance and then supervise the construction. However, when you buy a flat, you just have to take possession from the developer on completion of a flat, and then plan furnishing of the same.
A flat comes with all the basic amenities like power back-up, water supply, maintenance, security etc. On the other hand, for a plot you have to make all these arrangements on your own.
Income Expectancy
If your goal is to earn regular returns, then you must invest in a built-up flat. As, you can fetch good returns by giving it on rent. In case you want to build a house by buying a plot for sale, then don’t expect any return till the time it’s ready after construction.
Whereas, if you are expecting higher investment over a period of time, then you must invest in a plot.
Delivery Time
It takes a few months or in some cases even years to take possession of a flat. On the contrary, a plot is generally ready for possession.
In case your plot is a part of some ownership, then you usually get the possession earlier than a flat.
Fund Arrangement
In case you want to buy a plot for sale, then make sure to check whether your plot is approved by the legal authorities or not. You get a limited amount of funding support while buying a plot. Whereas in case of a flat, you can easily get around 80-85% funding via home loan.
The maximum land loan tenure is 15 years. On the contrary, for a home loan, it goes to 30 years.
In many ways, it is unfair to compare the two options (plot and flat) due to the different kind of investors they cater to. So, the next time you see someone banging their heads thinking whether to invest in a plot or a flat, make them understand and help them take the right decision.
