The first question when buying a house or land is – for what purpose are you buying? Real estate is bought for two main purposes. The first is to invest and the second is to consume. There are two different criteria for determining whether it is right to buy a property.
Even if the same property is unsuitable for consumption, it may be suitable in terms of return on investment. Some properties may be unsuitable in terms of return on investment but may be suitable in terms of usability.
It is not right to be in any kind of confusion and ambiguity before investing in real estate. First of all, it is important to understand the difference between investment and consumption. For example, when buying a property for residential purposes, location, and environment are of great importance, while in terms of investment, the market price growth rate of the property is the first condition.
It is important to take a closer look at these two important aspects.
What place to choose?
For Consumption: If you are buying a home with a plan to relocate soon, the location of the property needs to be comfortable. Make sure the location is in a comfortable area and all your needs will be met there.
The place should have easy access to schools, hospitals, and shopping malls and a road network that easily connects to other parts of the city. Similarly, it is important to understand the neighborhood. Whether or not your lifestyle matches the environment there is also an important aspect.
If you have seen an area that is less developed or will develop in a few years and there are no immediate plans to relocate there, what are the infrastructure plans prepared by the municipality or government body for the development of that area? Care should be taken to ensure that systematic housing schemes are being launched around the area.
This makes it easier for you to estimate how quickly the area develops.
For investment: If you want to make a profit by investing in property, choose a city-oriented area that will be developed and infrastructure in a couple of years, not a developed place.
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For investment: If you are planning to get a return on investment, it is advisable to invest in a house or flat that has not started construction or is in the early stages.
Investing in assets that are in the booking stage or under construction can yield comparatively higher returns. But, for that, you have to wait for the construction period. In Nepal, housing projects take an average of 18 months to complete.
For consumption: When buying a property to be used immediately, one should pay attention to the development infrastructure in that place. A good road network, easy access to schools and campuses, hospitals, business areas, recreational areas, bus parks, and airports make settling easier.
For investment: In terms of return on investment, less developed and infrastructural development sites are suitable. Because, in those places, infrastructure is likely to develop in a few years and the value of your property is likely to skyrocket.
One thing to keep in mind while saying this is whether the municipalities or local governments of those places plan to invest in roads, sewers, physical infrastructure, etc. of the area. It is important to make sure that the area has the potential to become a large school, hospital, or infrastructure for public pressure.
Type of property
For consumption: to buy land or a house? Buy a housing bungalow or an apartment built by a housing developer? You have many choices. We also need to look at what kind of property addresses the needs of the family. The decision to purchase property should be made on the same basis. You should plan what kind of property to buy based on the number of family members, their needs, income, and so on.
For investment: If you want a fair return on your investment, buy the type and type of property that is in demand in the market. For that, you can discuss this with a real estate consultant. Real estate professionals and their forums should follow and understand market demand.
Different types of property in different cities