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House or Land : Which property is right for you?

Property (along with Gold and Bank Fixed Deposits) is the most preferred investment for the Indians.

And, land vs house is the most debated topic when it comes to buying property. 

Both, however, have their pros and cons. 

Therefore, whether you should buy a piece of land or a house property, would depend on which option offers you more pros than the cons given your specific circumstances and requirements.

A. Plot or Land
- The supply of land is limited. And especially in cities it is a disappearing commodity. As such, it offers a high potential for price appreciation and quickly too.
- A plot is relatively more liquid as it can generally be sold much faster than an apartment.
- You get the opportunity to construct your "dream" home as per your choice and live with little interference from others.

- In India, land has seen many disputes as ownership is often unclear. Availability of undisputed land with clear title is rare.
- It is difficult to get bank finance for purchasing land. Therefore, your budget gets limited as you may have to finance it out of your own funds.
- It doesn't normally give you a regular income 
- Risk of encroachment is quite high
- If you propose to construct a house on the same, you have to devote much more time, efforts and money vis-a-vis buying an apartment from a developer. 
- There are no tax benefits on loan taken to buy a bare plot. Only if you construct a house on the same, do you become eligible to claim the specified tax deductions.

B. Flat or Apartment
- Building apartments require numerous approvals and sanctions from varied Govt. departments. So the likelihood of litigation is comparatively less.
- You can easily get a bank loan to buy a house property. This leveraging of cheap bank funds can give you huge gains with a flat, unlike land. And the tax benefits make the home loan all the more lucrative.
- You can easily rent out your property and get a steady inflow every month. Besides, due to inflation you get a chance to earn higher rental income every year.
- Though you may have to sacrifice some independence when you stay in a community, you gain in the form security, maintenance and amenities

- The appreciation of an apartment would depend on the construction activity, infrastructure and demand at a specific location. Moreover, after a decade or so, as the property ages the growth rate in the value is likely to stagnate or even diminish. 
- Delay in housing projects is rampant. So you have to be prepared for late possessions in case you plan to buy an under-construction apartment.

Investment in property requires huge outlay. Also, problems, if any, can be long-drawn and have serious repercussions. So make sure that you take time to weigh each aspect thoroughly before you invest in a "dream" property.

An Investment In Knowledge Pays The Best Interest ~ Benjamin Franklin

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