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Purchasing your first home can be a daunting task. With countless options available on the market, selecting the right property to invest in can be a challenge. Plots, independent houses, villas, and flats all come with their unique features and drawbacks. But which is the best property investment?
Flats or residential apartments are one of the most popular residential property investments – especially in the vertically growing metro and urban cities. Flats are not only affordable but also easy to finance as you can easily access home loans at competitive rates. Additionally, you can avail tax benefits on interest paid against your home loan. Flats also attract a higher resale value and a wider buyer pool speeding up the resale process and offering you a higher return on investment.
Builders also offer contemporary looks and modern amenities while the residential society takes care of maintenance, utility, and security services. Residential apartments offer a sense of community as you also enjoy the benefits of independent living. As a result, you are free to enjoy community amenities without having to invest significant time or resources. However, flats have a limited customization potential and can potentially lack privacy – especially on the lower floors.
Independent houses are ideal for individuals who value privacy above all and are willing to invest the high initial capital necessary. Due to the high initial capital investment and limited demand, capital appreciation may be limited for independent houses. Accessing home loans can also be difficult – involving more comprehensive scrutiny – for independent houses, but you can enjoy the same tax benefits as flats.
You can customize independent houses to make them your own. However, one of the major drawbacks of independent houses is that you are responsible for adding any amenities, maintaining the property, managing utility services, and ensuring the security of the property. This involves significant investment, effort, and time on your part to maintain the property. Developers today are offering independent houses in gated communities where you can enjoy individual and shared amenities – similar to residential apartments.
Villas are just the luxury versions of independent houses that often include gardens or even pools on the premises. Villas allow you to enjoy a luxurious living experience without compromising on your vision, quality, or privacy. Villas require a significantly higher initial capital investment. But if you have the resources, a villa is often a great investment as its value appreciates significantly with time and you can also attract high rental income with them.
Apart from being expensive, villas also need regular extensive maintenance of the property, landscape, and amenities like a pool, patio, or gardens. This further drives up the cost of owning a villa, making it an undesirable choice for individuals on a budget. Finding the perfect location for a villa is also difficult as you need to find a place that is desirable and scenic, connected, private, and provides all basic amenities.
Plots are vacant stretches of land – either in gated communities or standalone – where you can build a house from scratch that meets your requirements and reflects your vision. Plots open up a host of possibilities and opportunities for you to construct a house best suited for you. Residential plots are a great investment as they have a higher capital appreciation rate compared to constructed structures and demand is higher than supply.
However, buying a plot and building a home is extremely challenging and time-consuming. First, you have to find an available plot in a desirable location, which can be challenging. Further, banks offer significantly lower loan amounts to purchase plots than constructed homes, which also come with much sterner repayment terms and no tax benefits. You also need to invest in architects, designers, construction materials, and labour costs when building a house on a plot. And you cannot expect to enjoy the property or get rental income until you invest significant time, effort, and resources in residential plots. So, you have to look at plots as a long-term plan and be prepared to deal with market fluctuations and significantly higher initial capital investment.
Choosing between flats, independent houses, villas, and plots, you have to consider many factors like initial capital investment, access to financial assistance and loans, availability of amenities, maintenance cost and efforts, security, and return on investment. Your lifestyle preferences, investment plans, and rental potential also play a significant role in making this decision.
Wondering which property investment is the best for you? Get in touch with the Squarea team today to find the best home for you.
For more details on this subject, please email hello@squarea.io
With an abundance of options available, one of the first decisions prospective home buyers must take is whether they should opt for a ready-to-move-in or an under-construction property. Which is the better choice?
The answer is not always straightforward. Both have their unique advantages and drawbacks. And you must weigh them and decide which option is the best suited for your unique condition. So here are some major pros and cons of ready-to-move-in and under-construction homes to help simplify that decision:
As the name suggests, ready-to-move-in properties are finished residential properties that you can start enjoying immediately. But are they the right choice for you?
· Instant Access: One of the major benefits of ready-to-move-in property is virtually zero waiting period. You can immediately move in after making the payment and completing the necessary documentation. This relieves you of the stress of having to pay both rent and EMIs as you wait for possession.
· You Get What You See: In ready-possession homes, you get precisely what you see. There is no chance that what you saw during the visit will change once you move in. So you have the opportunity to check for the features you want and choose the home best suited for your vision.
· No GST: The Goods and Service Tax does not apply to ready-to-move-in properties. Additionally, you can immediately start collecting tax benefits if you use a home loan to purchase a ready-possession home.
· Learn From the Locals: You can interact with the locals to understand their experience living in the area, check the social infrastructure and connectivity, and see if this is the right community for you. You can also understand any potential issues you may face and decide whether the property is worth investing in.
· High Costs: Ready-to-move-in properties often sport a costlier price tag, often 20% to 30% higher than under-construction property.
· Construction Quality: You have no way of verifying the construction quality, analyzing the project development, and learning about the materials when buying a finished apartment. You will have to rely on visual checks and the word of the seller to gauge construction quality.
· Property Age: Buying a ready-to-move-in property does not guarantee you a brand-new home. The apartment may not have been put on sale for a while, it might have been on the market for some time, or previous owners may not have maintained it well. All these factors contribute to the home appearing old.
· Lack of RERA Registration: Older properties, with occupancy certificates issued before 1st May 2016, are not covered under the RERA Act. Therefore the responsibility of proper due diligence and access the relevant information from public platforms falls on the buyer.
Compared to ready-to-move-in homes, under-construction properties are in various stages of completion and still have some work to do. If you are ready to wait, are under-construction properties better for you?
· Lower Costs: When compared with ready-possession properties, under-construction properties can be anywhere between 10% and 30% cheaper. If you are on a tight budget and are ready to wait, this price difference can be worthwhile.
· Higher Appreciation: Property prices go up as the construction progresses. Additionally, improvement in local infrastructure during this time can also increase overall property values. So if you are looking for a higher return on investment, purchasing a property in the early stages of construction makes more sense.
· Flexible Payment Options: An under-construction property offers much more flexible payment options than a finished property. For example, you can reserve the property with a small down payment and pay the balance on possession or make partial payments as the construction progresses.
· New Construction: If you want to live in a brand-new home with no maintenance issues and a long life, under-construction properties are the way to go. They also give you access to the latest amenities, services, and design trends for a trendy home.
· RERA Compliance: Every property with an occupancy certificate issued after 1st May 2017 has to be registered under RERA. Therefore, all under-construction properties fall under RERA authority and are required to abide by its principles and ethical business practices. You can easily get information about new under-construction projects on the
· Offers: Since there is a wait to move into under-construction properties, builders often run promotions and offers to attract buyers. So you have to option to not only look for the home design and amenities you want but to find the most attractive offers as well.
· Greater Risk: Under-construction properties are higher risk investments as builders may fail to deliver on schedule or – in the worst case scenario – fail to deliver the project due to lack of resources. So researching the builder and choosing a reputed real-estate developer is essential when investing in under-construction properties.
· Disparity between Design and Finished Product: With under-construction properties, you run the risk of not receiving the promised amenities, altered layouts, or insufficient usable space at the time of possession.
· GST and Tax Implications: Under-construction properties are subject to GST – 1% for homes priced under INR 45 lakh and 5% for properties worth more than 45 lakh – in addition to stamp duty and registration fees. Additionally, you also cannot claim tax benefits for under-construction properties until possession. However, the interest you pay on a home loan is tax-deductible (up to INR 2.5 lakh) if you move in within three years of securing the loan.
Ready-to-move-in or under-construction, both properties have their advantages and drawbacks. You need to assess your unique situation and decide which option suits your needs the best.
Looking for a property to suit your lifestyle? Get in touch with the Squarea team today to find the ideal home for you.
For more details on this subject, please email hello@squarea.io
In attempts to accommodate the growing population and influx of people for better employment opportunities, many Indian cities are now growing vertically. As a result, which floor to buy a flat on has become one of the most pressing questions for prospective home buyers. Should you go for accessible lower floors or enjoy scenic views from the top floors? The answer is not always straightforward but can significantly impact your living experience. So are you a home buyer contemplating which floor will be the best for you in a high-rise residential project? Here are some factors you should consider before making that choice:
Floor Rise Charges (FRC) Because of the perceived higher quality of life on top floors, many builders charge – anywhere between 15% and 25% – extra for flats on higher floors. The FRC is determined by the builder or the construction company and takes into account the overall construction costs, interests, and overheads. So if you want to live on higher floors, you will need to adjust your budget accordingly.
Security and Privacy Lower floors are usually considered comparatively unsafe as they are easier for criminals and other anti-social elements to break into than upper floors. But if you are set on choosing a lower floor, be sure to verify the security arrangements in and around your high-rise complex. Additionally, lower levels also offer less privacy, especially if the building is near a busy road. So if you want to enjoy a quiet and peaceful home, higher floors may be better suited for you.
Fire Safety Fire safety can be an issue for occupants on higher floors. An occupancy certificate from the local authorities can help you determine whether the building has received clearance from the fire department and meets the necessary safety criteria.
Access and Family Considerations Ideally, high-rise buildings must offer at least two lifts and staircases so people can rely on another lift in case one fails. The number of lifts and backup systems becomes crucial when you consider your family members – especially elders and small children. In a case where both lifts fail, you have to rely on staircases and must consider whether they would be convenient to use and easy to access.
Floor Deviations In many cases, builders deviate from the construction plans on the top floor, which can get you in trouble down the line. So if your heart is set on the top floor, make sure that the construction adheres to the approved plans and has all the necessary clearances.
Network Coverage You may experience spotty mobile network coverage as you go up in a high-rise building. Broadband facilities may also be unavailable on higher floors. So make sure you have adequate network coverage in the flat if you choose a higher floor.
Power Consumptions Lower floors are generally cooler than top floors and require less energy – especially during summers when you must run AC units or coolers to keep your house cool. You need to keep the electricity costs in mind when choosing the floor, especially if your city experiences long and harsh summers.
Vantage Point The most obvious advantage of top floors is the vantage point and views you can experience from your windows or balconies. So if the high-rise is near a scenic place and you want to enjoy the view, go for the top floors.
Light and Ventilation Apart from the view, higher floors also have better natural light and ventilation, making your home feel light and airy. You will also be away from street-level disturbances if you opt for top floors rather than ground or lower floors.
Rental Returns If you are buying a flat as an investment, lower floors may fetch better rental returns. But make sure to understand how the climate affects renters' choices. For example, renters in Mumbai or Bangalore prefer upper floors – away from the noises of the street, whereas renters in Delhi – NCR and Chennai prefer lower floors. Still confused about what floor to choose? Squarea expert team can help you find the right luxury home for you. Get in touch with us today to find the home that fits your lifestyle.
For more details on this subject, please email hello@squarea.io