If there is a common wish list shared by all Indians, owning a piece of land would be there right on top. With rapid economic development happening in the country, real estate has proven to be an excellent investment option, delivering tremendous returns more often than not. The finite supply of land and exponential growth of population is making land a priced possession. Plots are expected to appreciate very quickly and the return numbers shown by various real estate agencies echo the beliefs. But is it always so rosy? Investing in a plot has always had its advantages, but there are also a few demerits.
Advantages of investing in a plot
Unlike investing in debt or equity, land is a tangible asset and the economics of supply and demand always put an upwards price pressure on land. The Plot gives you an option to buy in different sizes according to your requirement. Since there is no construction on the plot, the taxes and the maintenance cost are usually lower. You have an option to build a home or any structure of your liking on the plot, giving you a platform to experiment with your design ideas, and, if you want to generate additional income, you can start renting your plot.Putting it up as a house for sale in Bangalore would promise profitable returns. Add-on space can be purchased based on your funds and availability and you can construct on a larger plot.
Disadvantages of investing in a plot
A plot is not an immediately disposable asset. If you’re in need of urgent cash, you will be forced to look into other investment options.Since banks don’t usually provide loans for buying plots, you have limited financial options for buying empty land. Land usually generates very low regular income whenlet out for rent, compared to what the piece initially cost you.On the other hand, empty plots are prone to litigations and it’s a difficult situation to get out of, hence making it important to check with your legal advisor for any legal issues before buying a property. Keep in mind to also check if your property falls under different land use zones - you might not be allowed to construct a house in an industrial area or putting up flats for sale in Bangalore or any other major city is not allowed in some areas.It’s necessary to investigate if the plot has been earmarked under the government acquisition plan and to look for a plot which has convenient road services that are properly maintained by civic bodies.
To get the maximum returns from your plot investment, it is extremely crucial that you take care of the issues sighted above, visit the plot often and follow the formalities to secure it. There may be a few disadvantages in investing in a plot, but history has showed us that a plot can give us huge returns provided we are willing to invest money and time.
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