Is land a wise investment?

arulselvamsk
Aug 24, 2017 · 3 min read

When it comes to real estate investments, people have differing opinions. Some vote for landed property while some others believe that only buildings like houses, flats, shops, etc. offer a safe income or profit. It is safe to say that both types of properties have its own advantages and drawbacks. However, land as an investment more benefits and flexibility to the owner. Let us examine some factors that make land a wise investment.

· Price

The main factors that decide the cost of a land are location and size of the property. It is easier to evaluate the rate of a land based on the current price trends of the region and the total area of land. When it is a house or flat, several other elements influence the cost of the property. There are factors like age of the building, features, amenities, design, materials used, accessibility, civic and physical infrastructure in the area, etc. that decide how much a property will cost. It requires a lot of comparison and research to negotiate a price for the building. In the case of independent houses or villas, the total price involves the price of the land as well as that of the building.

· Value appreciation

The greatest benefit of investing in land is that the value of the property appreciates over the years. A house or flat loses its value after a few years. When new designs and structures come up with the latest infrastructure and facilities, older properties depreciate in value. Land never gets old. Land gets more benefits when the area develops. In prime locations, where land is a scarce resource, even a small plot can fetch good profit. Even if you cannot get land in the heart of the city, developing areas that show great growth potential are equally advantageous. For example, if you want to buy land in Pune, the peripheral cities in the suburban regions are good bets. As the localities develop, there is high value appreciation for the properties.

· Scope for upgradation

You can add utilities like water and electricity, approach roads, etc. to a land to increase its value. The cost involved is negligible considering the profit it will earn in comparison with raw plots. Although houses and flats can be modified for better value, it requires more money and effort. And, yet it may not bring the expected returns.

· No waiting period for possession

When you buy a plot, you get immediate possession of the property. In the case of a flat or villa, the project needs to be completed before you can get the ownership of the property. Indefinite delays in project completion affect home loan repayments as well. Land does not pose such problems for the buyer.

· Easy to maintain

Land can be maintained without much cost and effort. While houses or flats require repairs, and periodic service and maintenance to keep it in good shape, land only needs fencing or weeding to keep it neat and tidy. Even if you neglect the plot for a while, it remains intact without damage.

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