Buying Vs Investing in a Residential Property – What’s the Difference?

As everybody already knows, we buy homes so that we start a new life elsewhere with a better standard of living. We choose a better location, we select a better developer, and we make other necessary decisions before the advent of a new lifestyle. However, is this all that one can expect from a residential property? Is this the only function that it serves to provide?

Here is where we see another use of residential property – for investment. While buying an apartment assures complete home ownership for residential purposes, investment properties are not primary residences and are known to generate passive income. Whether you invest in a 2 BHK flat in Rajarhat or anywhere else, you need to choose to invest in properties that come with a guarantee of a high potential rate of return.

If the region does not show growth or promise, this will become a financial burden in the long run. On the contrary, a good investment, such as investing in flats in Rajarhat, will make up for mortgage payments, cost of taxes, utilities, repairs, etc. through renters. In fact, it may end up being a means of building wealth if your planning goes well.

Here’s all you need to know about both!

Understanding the Concept of Buying and Investing in Residential Property

Residential property comprises of a demarcated area developed for individuals or families to live in which is not to be used for commercial or industrial purposes. These spaces are primarily designated for occupational purposes and involve residential use for a long duration of time.

On the contrary, an investment property can be either a long-term or short-term investment. If we consider a short duration of time, the property is bought and remodeled or renovated and is sold for a higher price. This is what we call ‘flipping’ a house.

One can generate income by holding the property and renting it to others, or selling the property at a time when the value has appreciated. For instance, flats in Rajarhat are close to the airport and thus, have high value for residents. Similarly, other apartments positioned near good schools and colleges will have more value than others.

Kolkata is a region where new students are always looking for housing. If you find a 2 BHK flat in Rajarhat that is positioned near a college, the value of the said property automatically increases. This leads to more desirability and hence, more rent for apartments. The dynamics are not very different when it comes to buying a property. Convenience to good schools and colleges also result in higher prices of property.

However, here are the features that separate both:

Kolkata is a vast city with no shortage of homes. So, whether you buy a residential property or invest in one, it is important to do a detailed scan of the regions you wish to specifically target. Whether North Kolkata or South, whether upcoming projects or ongoing, it is always necessary to know which areas will provide you with the best advantages to suit your daily needs.:

Make all arrangements and informed decisions and get the best for your living spaces. 

About the author

Leave a Reply

Your email address will not be published. Required fields are marked *