After the arrival of the pandemic, people aspiring to buy residential properties are looking at things differently. With work from home (WFH) becoming a norm at most workplaces, people who would have looked at buying residential plots in prime locations of Hyderabad are now instead of looking to buy a plot on the outskirts of the city.
This has led to an increased demand for residential plots, with some people opting to buy independent houses, unlike apartments in the past. Surveys conducted by leading real estate developers across India also point to the fact that in metros like Hyderabad, Bengaluru, NCR, Pune, etc., more demand is being witnessed for residential plots than say a few years ago.
Although these days purchasing a residential plot and getting it developed the way you want may look like an attractive proposition, you need to factor in some of the disadvantages that such a deal would entail.
Let us look at the pros and cons of buying residential plots in Hyderabad
Scope for developing as per one’s interests
When you buy a plot, you can get it constructed the way you want. Such an option is not available in flats or apartments where all flats in a particular community are designed uniformly. In addition, the owner of a plot can plan the construction of a house depending on his personal finances.
When an individual buys a plot from a developer, that person is at a lower risk as it involves only a piece of land. But in the case of apartments, the developer has to deliver them as promised by him and the buyer requires getting several clearances and approvals.
The prices of plots increase with the passage of time. In the case of apartments, the prices do not appreciate significantly. The buyers of plots, therefore, get higher returns on investments (ROIs). In fact, the prices of apartments, at times, depreciate when compared to their peak levels. More people opt to buy newly built apartments when compared to old ones. So, a flat owner cannot dispose of property at a high-profit margin.
Fewer finance options
When you want to buy a plot, finance options are fewer. Even if the interest rates of land loans are on par with that of home loans, the loan to value (LTV) share is mostly lower, causing a buyer to spend more when buying a plot of land. Adhil Shetty, CEO, Bankbazaar.com is quoted by livemint.com as saying that the highest LTV for land loans is about 70% as compared to 90% for home loans. While home loans can be repaid in up to 30 years, the highest duration to repay a plot loan is 15 years, he added.
Tax is not deduced on land loans
If you are planning to buy a residential plot in Hyderabad or any other city in India, tax is not deduced. Even though tax deductions are applicable on loans borrowed for the construction of a house, they can be availed only after it has been fully constructed.
So, if you have adequate financing options, it is better to opt for a plot. If not, you would be better off buying an apartment in a community. But you can always save money if you intend to buy a plot and get your own home constructed.
If you are interested in buying a plot to build your own home around Hyderabad, contact Sterling Heights through mail or giving them a call.