Apartment Vs. Plot Which One Is Better for Investment In Pakistan
It is a well-known fact that the apartments in Pakistan are very expensive compared to plots. This is because of various reasons, such as the cost involved in buying land and building structures on it, which can be avoided by purchasing an apartment instead. There are many advantages of owning an apartment over a plot; some being lesser maintenance costs, higher rent yields and lower risk involved in property management.
The biggest advantage though is that you get more space for your money than if you were to buy a plot of land. If you have decided to invest in real estate, then you should know what kind of investment will yield better returns. It depends on the location where you want to live in, but there are several things that one must consider before deciding which option is better.
The Cost of Buying a Plot or An Apartment
One major difference between buying an apartment or a plot is that the former involves paying monthly instalments whereas the latter comes with instalment loans. However, both options involve making payments every month; hence they are not much different from each other. You also need to bear in mind that buying a plot does not require any construction work unlike purchasing an apartment.
Once you buy a plot, you don’t have to worry about maintenance costs as well. Apartments come at a price tag, although it’s not as high as buying a plot. Also, when it comes to renting out an apartment, you will earn rental income for years to come, whereas buying a plot may give you immediate returns. Renting out an apartment gives you flexibility as well since you can choose tenants based on their needs rather than location.
Rent Yields
When it comes to calculating rent yields, apartments usually pay more than plots do. In addition, this amount varies depending on how long you plan to stay in the apartment. Landlords prefer having tenants who intend staying longer in order to increase profits. When it comes to buying an apartment, the rent yield is calculated after deducting the mortgage loan interest rates and taxes from the purchase price. On the other hand, when you buy a plot, you just calculate the annual yield without taking into account any additional expenses. Although buying a plot has its own advantages, purchasing an apartment will result in greater financial gains in the long run.
Location And Property Management
Another important factor to consider while investing in real estate is location. Most investors believe that properties located near main roads fetch better rents. However, this isn’t always true. Some people prefer living far away from the hustle and bustle of city life so that they can spend time with family members and friends.
Others may prefer buying an apartment close to their workplace. If you are planning to buy a plot of land, then you need to check whether it is situated near the nearest metro station. In case of an apartment, it is advisable to look for a place that is easily accessible by public transport. Moreover, most landlords prefer having tenants who take care of their properties regularly, thereby reducing their workload. In addition, the landlord can manage the property using online platforms like TenantHub.
Although plots are cheaper than apartments, buying one requires considerable funds. Hence, one must decide which investment fits his/her budget best. Both options have pros and cons, but one cannot deny that purchasing an apartment offers better returns. However, one must also keep in mind that he/she will have to make regular payments every month until the end of the lease period.
Purchasing a plot of land in Pakistan is considered to be the safest way to invest your hard-earned money. However, buying an apartment comes at a higher price tag. So, which option is better? Only time will tell.
It is a well-known fact that the apartments in Pakistan are very expensive compared to plots. This is because of various reasons, such as the cost involved in buying land and building structures on it, which can be avoided by purchasing an apartment instead. There are many advantages of owning an apartment over a plot; some being lesser maintenance costs, higher rent yields and lower risk involved in property management.
The biggest advantage though is that you get more space for your money than if you were to buy a plot of land. If you have decided to invest in real estate, then you should know what kind of investment will yield better returns. It depends on the location where you want to live in, but there are several things that one must consider before deciding which option is better.
Final Words
As discussed above, there are several factors to consider while choosing between buying a plot of land or an apartment. The ultimate decision lies with the investor himself, although it is recommended that he consult a professional realtor before making any purchases. In addition, there are certain other considerations such as tax deductions and inheritance issues.
