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Land or Apartment: What is the best investment option?

Whether to buy a land or an apartment is one of the most common concerns both the first-time and second-time buyers have. This is mainly because, right from the costs involved to the appreciation value to the loan possibilities, there are numerous factors to carefully weigh in.

So if you are confused about investing in a land or an apartment, don’t worry, you are not alone. At Sizzle Properties, our customer service team regularly meets many customers expressing the same dilemma.

That’s why we have chosen to address the issue in this blog post. Now let’s take a look at the pros and cons of investing in a land and an apartment.

Advantages and disadvantages of investing in a land

When it comes to money, investing in a land will obviously cost you less. Plus, the option to get land loans from financial institutions makes this option quite attractive.  But remember, ideally land loans are easily available if you are buying the plot from a Gated Community. Also, the company selling the plots should be reliable like Sizzle Properties. Otherwise, getting loans for an individual plot would be a really challenging issue.

On the other hand, if you are able to invest in a plot without seeking loan assistance, then you can certainly go ahead and buy that piece of land. Since the availability of land is becoming scarce, especially in cities, the value of the land is only bound to appreciate in the future.

A plot purchased in an excellent location can get you up to 35% to 45% appreciation annually within a short 2–4 year period.

The risk associated with investing in a land lies mainly in the legal hassles. You have to absolutely ensure the land you are going to invest doesn’t have any kind of legal issues. Otherwise, your money, energy and even peace of mind will be drained in solving the litigation issues.

Even if you think the land value would skyrocket in the future, we do not recommend getting yourself involved with a land that is vulnerable to litigations.

Unlike apartments or independent houses, lands do not generate immediate income. It will only offer you good returns in the long run. You must be content in knowing that Land is a lifelong asset.

Advantages and disadvantages of investing in an apartmentBuying an apartment or an independent house is always a costly proposition. However, getting a house loan is very much easier and faster when compared to land loans.

You can find plenty of financial institutions dedicated to offering housing loans.

The main benefit of investing in an apartment/house is the possibility to generate a monthly income. Unlike lands, you don’t have to wait for years to get good returns.

If you buy an apartment in a good locality, you can generate income by renting it out.

We advise you to invest in an apartment/house located nearby colleges, healthcare institutions, IT parks, and tourist centers. They are always a goldmine for income because you will be able to rent your house to the moving population and earn money.

In case, if you have reservations of a rental income, it is better you avoid investing in an apartment as the resale value of a constructed building is bound to depreciate.

In fact, this is the main drawback of investing in a building. You will not get an appreciation value because of the construction. No matter how premium the building is, the value of an apartment or independent house will depreciate over the years.

Conclusion : Investing in an apartment or an independent house is a good choice only if you are able to turn the house into a source of rental income.

Whereas, investing in a plot is always a safe bet because of the guaranteed appreciation value of the land.

So if you have the financial luxury to afford an apartment for investment purpose and generate income from it, go for it by all means. But if you are applying for a loan and then buying an apartment solely for investment purpose without any plans of moving in sooner or later, then it is better to invest in a plot.

What do you think?

Whether you agree with us or disagree, we would love to hear from you.

Let us know your thoughts and comments about the blog post. And if you like the post, please do share it with basically everyone you know.

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SIZZLE PROPERTIES PVT LTDISO 9001 : 2008 Certified Company

#290, 6th Cross, Vijaya Bank Colony Main Road, Dodda Banaswadi Bangalore – 560043.

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