Which is better for investment – Plot vs Flat?

Are you confused about whether to invest your money in Plot vs Flat? Before investing all your money in any investment, it is important to check every small thing. In this blog, we will explore and learn everything about the differences between plots and flats.

Most people are in a dilemma about investing in plot vs flat, where to invest their lifelong earnings to get safe and good returns.

Investing in property is often more challenging than it appears. It involves not just financial investment but also careful consideration of what to purchase, what to avoid, and where to buy. Deciding whether to invest in a ready-made house, apartment, or plot depends on y our primary needs and factors such as the availability of a bank loan.

So now let’s know which is better for investment – plot vs flat

A simple comparison between Plot vs Flat

Plot	Flat
In a plot, you can build a structural building as per your choice.	There is already a structure built in the flat, only a few changes can be made to it
The quantity of plots is limited hence its cost is higher as compared to flats and it also gives higher returns.	As time passes, a house, apartment, or flat starts to deteriorate, and hence its value also starts decreasing.
Obtaining financial assistance for buying a plot can be challenging, as it is somewhat difficult to secure a bank loan for this purpose.	But it is easy to get a loan from the bank to buy an apartment or flat.
You can rent a plot only if you build some kind of structure on it	You can rent out your flat or apartment directly and keep getting your benefits

Residential Plot vs Residential Flat (Plot vs Flat) Comparison

Here, you’ll find a comprehensive comparison of plot vs flat to help you determine which investment best fits your budget and needs

To purchase a plot, you need to follow the government layout construction plan. And to build a building on it, a contractor and architect have to be appointed. The building construction has to be handed over to contractors to supervise. It requires a lot of hard work to arrange even small things.

If you buy flats or apartments, then you do not need all these things, the responsibility for this lies with the builder. After the flat is built, it is in your possession. It is only your responsibility to decorate it.

Apart from this, you get many additional facilities. Like a swimming pool, power backup, storage for a few days, security system, sports complex, and many more.

But if you build a house after buying a plot, then you have to do all these facilities yourself. Which costs a lot. Therefore, buying a flat is a little easier than buying a plot.

Plot vs Flat:- Handover

Compared to a plot, one has to wait for a few months or a few years to get possession of a flat. But one does not have to wait much to get possession of a plot. If the plot is part of a township, then possession is given much earlier than a flat

Return on flat vs plot

Some real estate experts believe that the price of plots increases faster than apartments. This happens because plots are available in a limited quantity in the market and the demand is high. The more time you have to buy a plot, the more the expected return.

But the price of apartments increases when more infrastructure projects are built around it and its price increases with the market conditions and the plot.

It is easy to invest in plots, so there are more buyers and it is easy for you to sell it and get out.

Earning income from Plot vs Flat

If you want to earn income from rent then a flat can be the best option for you because when you buy a plot, you have to first make a structure on it and only after that you can rent it out. Whereas flats can be easily rented out

• Any person can take a loan from the bank to buy a plot but there are some conditions for this.
• The plot must be approved by the local authority.
• The loan to value (LTV) of 80% of the value of the plot is approved.
• In the case of a resale plot, only 50% of TLV is allowed as a subsidy.
• In home loan, buyers have the possibility of getting about 80-85% loan for buying a flat.
• For purchasing a plot, the maximum loan term available is 15 years. In contrast, when it comes to buying a flat, the loan term can be extended up to 30 years.

Some legal aspects of plot vs flat

While buying a plot or flat, finding out the land ownership, getting its documents transferred in your name, and finalizing the paperwork is a challenging process for people. When you buy land, you are the complete owner of that plot, whereas when you buy a flat or apartment, you are the owner of some flats or units, so it is very important to find out its owner.

Because the ownership of the plot can be for many generations. Now it is common for one or two people to own a flat

While buying a plot vs flat, keep these things in mind which are given below.

• Choose the right location so that you have easy access, check the properties and amenities nearby so that the prices of plots and flats may increase in the future and you can get good returns.
• Buy plots and flats from a good and reliable builder or developer so that there is no problem in the future
• Plan for long-term investment so that you get good returns. And consider renting it for a long time