Plots vs Flats: What Offers Better Long-Term Value?

The booming real estate market of Gurgaon has been a real estate investment magnet for both end users and investors. With rapid urbanization, top-tier infrastructure, and high return on investment, Gurgaon offers a diverse range of properties and investment opportunities. But that classic debate is still there that whether you should invest in plots or flats, and we are here to discuss it all and give you a brief comparison so you can determine what is best for you.

The Case For Plots

Advantages

1. Higher appreciation potential: When purchasing a plot, you own the whole land, and land value increases more than a particular flat or plot due to the flexibility of options it can be used for, as well as having a plot on a high-return place can yield much higher returns and development opportunities. 

2. Customization Flexibility: When having your plot, you can build whatever you want to and however you want to, as long as it is under government regulations. Designing and building a home the way you want it will bring much better satisfaction and use of capital than it would in an apartment.

3. Lower Maintenance Cost: Purchasing a plot and holding it or even constructing a home on it requires a lower maintenance cost, as you don’t have to give any funds for clubhouses or maintenance for lawns and things that you usually would pay for in a residential society. 

4. Ideal For Long-Term Investment: If you are planning to hold your investment as a plot and not plan to build on it, it can bring an amazing long-term return as plots yield better appreciation as year goes by.

Disadvantage

1. Delayed Utility: You will have to wait for certain approvals and build before you will be able to use your plot as a home or personal property.

2. Lack of Immediate Returns: If you are looking for a short-term return, then investing in plots will not be an ideal choice for you, as plots give appreciation in the long term.

3. Need for Due Diligence: Clear titles, zoning rules, and infrastructure around the plot must be verified.

The Case For Flats

Advantages

• Ready to use and Easy to rent: The biggest benefit of investing in a flat is that they are mostly ready to use, and renting is easy as applying butter on bread, especially in a city like Gurgaon, where people look out for rented property a lot.

• Maintenance and Security: Flats in gated societies in city like Gurgaon, comes with total security, maintenance and amenities like gym, swimming pool, sports facilities, and much more. 

• EMI Friendly: Easy loan approvals and phased planned payment plans makes purchasing a flat easy and hassle free while also making it less financially burdening. 

• More Liquidity: Flats are usually easy to sell and rent out, especially in high demanding places like Golf Course Road, Sector 82 or DLF Phases. 

• Second Source of Income: Having a flat in high-demand areas can work as a second source of income with a good rental yield, as some places offer amazing rental appreciation per year.

Disadvantage

• Limited Customization: Owning a flat in a gated society, you have very limited things that you can customize, mostly the interior design. You cannot change the build structure or customize shared walls, making the options limited.

• Depreciation: Buildings age, and flats may need maintenance and renovations over time to keep up.

• Lower Land Share: Unlike Plots, in Flats you own the unit but not the land, you may be provided with a fraction of share of the land but it is a mixed authority.

Gurgaon Specific Trends

• Plots in areas like Sohna and SPR has seen appreciation of 15-20% YoY in the previous years making them an ideal long term investment.

• Rental yield in premium societies hovers around 3-5% per year, making it an ideal choice for investors who seek passive income. 

• With the upcoming development like Jewar Airport, Metro Expansion plan, and the completion of Dwarka Expressway with the tunnel to the airport, demand for both Plots and Flats is high. DLF Phase 6 also makes the demand for flats high as they are bringing the Cybercity 2 along with the township project DLF Privana, creating an ecosystem that they have been creating for a long time.

Conclusion: Which one wins?

In a city like Gurgaon, investment in both flat and plot is beneficial to the investor. The ideal choice for you should be the one that aligns with your investment goal.

So, in the end, If you are thinking of future and are willing to wait, investing in plots should be your go, if you want a passive income or a quick return on investment then investing in flats or underconstruction project should be ideal, and if you want to have the best of both world, then buying a plot in underdeveloped area that is set to develop in future and buying a flat in high demanding area would be the best choice for you.