- Advertisement -
HomePEOPLEPlot vs Flat: What is the right option for you? From appreciation...

Plot vs Flat: What is the right option for you? From appreciation rate to tax benefits, Know everything here

When deciding between plots and flats for investment, there are several factors that need to be assessed carefully.

Plot vs Flat: Before making a decision between investing in flats or plots, it’s essential to consider factors such as workload, legal matters, and financial assistance. Real estate is a favored investment choice for some, as it can diversify investment portfolios and provide an additional income source. A joint report from NAREDCO and EY predicts that India’s real estate sector will reach a market size of US$1 trillion by 2030. So, if you’re contemplating real estate as an investment, this article will explore the various aspects of purchasing a plot versus buying a flat to help you make an informed choice.

Appreciation rate

While both plots and apartments are components of your real estate portfolio, they exhibit differing rates of appreciation. Generally, we observe that plots tend to yield a higher appreciation rate and return on investment compared to apartments, primarily due to the limited supply of plots in contrast to apartments.

Furthermore, apartments typically experience depreciation over time as a result of normal wear and tear, a factor that doesn’t apply to plots. Additionally, if a plot is situated in a developing area, its appreciation rate is likely to surpass that of plots in already established regions.

Amount of work

Purchasing a plot and constructing a house entails substantial effort. If you’re building a home on the plot, you’ll need to engage various resources like architects, masons, plumbers, and electricians. This requires active involvement in every stage of the process. If you lack knowledge of construction procedures, you’ll need to familiarize yourself with them, making the process time and energy-intensive.

In contrast, when acquiring an apartment, the primary work revolves around interior furnishings and procuring electronic items if you intend to rent it out as a fully furnished unit.


When you purchase a plot, you have the flexibility to design and modify the house according to your preferences. You can construct a villa or a building with multiple units for rental purposes, offering a greater degree of customization. Conversely, when acquiring an apartment, your freedom for modifications is more limited and primarily pertains to internal changes.

Income potential

When you invest in a plot, you need to construct a house and rent it out to begin earning rental income, a process that may take several months or even up to a year. In contrast, purchasing an apartment allows you to generate rental income immediately.

Tax benefits

Many investors prefer plots for long-term investments, but it’s important to note that there are no tax reliefs associated with buying land alone. Nisha Sanghavi, a Certified Financial Planner and Director of Promore Fintech, explains, “When you buy an apartment, you can avail of tax benefits on the loan, covering both the principal and interest, along with additional costs like stamp duty. However, if you purchase only land, you won’t receive these benefits unless you construct a house on it.” Nevertheless, once you build a house on the plot, you become eligible for tax benefits on the loan used for both plot acquisition and house construction.

Legal issues

Acquiring a plot can pose a considerable challenge in terms of the transfer process, often involving complications in determining the genuine owner and sorting through paperwork. However, this doesn’t imply that purchasing an apartment is without its own set of considerations.

When you buy a plot, you’re essentially obtaining sole ownership of that land. Conversely, when you purchase an apartment, you’re acquiring a unit within a building situated on a specific piece of land. There’s a potential risk involved: the building housing your apartment may encounter disputes or issues in the future. This is why it’s essential to thoroughly investigate the land’s ownership when investing in an apartment.

Keep watching our YouTube Channel ‘DNP INDIA’. Also, please subscribe and follow us on FACEBOOKINSTAGRAMand TWITTER

Enter Your Email To get daily Newsletter in your inbox

- Advertisement -

Latest Post

Latest News

- Advertisement -