Real estate investment is the biggest financial decision a person makes in his lifetime. Almost all the savings go in for buying a property and the EMI continues for decades.
People buy real estate for different purposes for their own living or for investment. When it comes to real estate investment it depends on the aspiration and buying power of the buyer, they buy villa plots for capital gains in future or rental properties for monthly returns. The monthly yield for residential properties in India is between 3 and 3.5% and commercial is around 8%.
If you are a beginner and have limited capital to invest in real estate you can start investing in low budget plots in any developing localities of metro cities. Real estate loan is costly in long term and cannot give you much capital gains while selling the land so to avoid this and get a good gains in future you can start investing in EMI plots or instalment scheme plots in which you can buy directly from the builder and pay the amount in an equated monthly instalment to the builder directly.
You can find these kinds of plots in the developing localities of the metrocities. You can find EMI plots in Chennai in the developing localities like Oragadam, Tiruvallur, Chengalpattu and Sriperumbudur which can give you good capital gains in 10 years.
Here are the five reasons for you to invest in EMI plots.
1. You need not to pay Interest :
Yes, since you are buying and paying the amount in instalments directly to the builder you need not to pay any interest as in bank loans. This saves you a lot when you realise the capital gains while reselling the land in future or when you use it for your own living.
But this kind of plots are usually Rs.100 to 200 higher per sqft than the market price, you have to negotiate and get the best price from the builder.
2. Your don’t need CIBIL:
If you are someone who don’t have CIBIL or doesn’t want to expose the CIBIL you can avail this option for buying a property . Builder’s don’t need your CIBIL score , once you complete the payment you can register the property on your name or by paying 50% down payment.
3. Fixed rate no fluctuations :
Unlike housing loans there won’t be any fluctuations in the rate of interest or in EMI amount. You can plan your monthly expenses with clarity. This gives you protection against inflation. Also, you can pre close the instalment anytime at zero closure charges and sometimes you may be encouraged with incentives to close it down quicker.
4. Approved plots :
The market problem with low budget plots is the approvals or titles won’t be clear but when you buy a plot directly from the registered plot promoters they take all the approvals you can buy without any tension or fear.
5. Affordability :
Buying land on a monthly instalment basis can be more affordable as it allows to spread the EMI over a longer period of time. This can be particularly beneficial for those who don’t have enough funds at the time of buying or having any other commitments.
Land is a finite resource, investing on plots will give you appreciation in future as the population grows. Start investing earlier.
