28/12/2013
Whether to buy Land or Apartments/flats? This is a question that bugs a lot of investors. While there is no definite way of answering this due to the large number of factors involved: Location, FSI of the locality, Population density, Rise in building cost due to inflation, depreciation in the value of constructed property, time value and expertise needed in building construction etc, the simple rule of thumb goes that if the land is in an area where the population is expected to grow significantly in the coming areas then it makes more sense in buying land, whereas in an area which is already pretty settled buying an apartment can give you better returns.Some might argue that land would always give better returns because there is low maintenance cost and no depreciable component attached but what they are not taking into account is that a land is not giving you any returns on its own either and if those returns are taken into picture over a number of years taking the high inflation and risk free rates in India it could prove to be a significant factor.