Should NRIs invest in apartments or plots in Bengaluru real estate

Bengaluru real property market is witnessing an increase in prices in the luxury segments, which appeals to many Non-Resident Indians (NRIs) to eye the city as a lucrative investment destination. But many of them are in a decision of whether to invest their money in an apartment or invest in a plot to get long-term potential.

Based on real estate experts' views, the choice between a plot and an apartment for an investor depends on investment goals. Apartments will offer rental income and quick possession, making them ideal for mid-term returns. Plots will have long-term appreciation.

Benefits of investing in Apartments: Quick returns

Apartments offer an annual return of 4%. It has the potential for an overall return of up to 20% depending on location. The city's growing population have improved the rental market, making apartments a lucrative choice for NRIs seeking quick and regular income streams.

Which area is the best for apartment investment in Bengaluru

In East Bengaluru, the starting prices are from Rs. 8,000 per sq. ft. in areas like Whitefield. A 2BHK apartment costs around Rs. 87 lakhs to Rs. 1 crore. Ultra Luxury properties like Prestige Evergreen in Whitefield have prices starting from Rs 1.1 Crore, but the rental return is high that starting from Rs 40000 a month.

North Bengaluru has been a hotspot for apartment investments in recent times. A 2BHK apartment price starts at Rs. 1 crore, and for that, the rental yield is between Rs. 30,000 to Rs. 40,000 a month. Luxury apartments will cost Rs. 2 crores, and they will have a monthly rental income between Rs. 50,000 to Rs. 60,000.

In areas like Hebbal, prices of flats range from Rs. 10,000 to Rs. 12,000 per sq. ft. The cost of a 2BHK flat is from Rs. 1.25 crores to Rs. 2 crores. But the rental returns are higher, which is from Rs. 40,000 to Rs. 45,000 in a month.

South Bengaluru offers affordable options at Rs. 7,000 per sq. ft. The rental income for a 2BHK is in the range of Rs. 25,000 to Rs. 30,000. In the luxury segment, the starting prices reach Rs. 40,000 per sq. ft.

Benefits of investing in Plots: Long-term appreciation

Investing in plots gives NRIs the flexibility to sell or build a dream house in the future, which will yield high returns. But plots may not give immediate income, and they need a long investment horizon.

Plots are seeing steady appreciation in Bengaluru, as the annual growth rates are between 15 to 20%. But the returns depend on factors such as location and the overall project offering.

Many gated community plotted developments across Bengaluru now come with modern amenities like gardens, swimming pools, parks, spa, gym, clubhouses, and much more. These modern features will boost land value, and it is a safe option for long-term investment.

• North Bengaluru - In North Bengaluru, plot prices start from Rs. 5,000 per sq. ft. in Devanahalli. In Hennur and Bagalur, plot prices are around Rs. 6,000 per sq. ft.
• South Bengaluru - In South Bengaluru, prices are from Rs. 4,000 to Rs. 18,000 per sq. ft. A standard 30x40 plot would cost Rs. 50 lakhs in the area.
• East Bengaluru - In East Bengaluru, plots are in high demand, with prices starting from Rs. 10,000 per sq. ft.

To conclude, NRIs can decide to invest in apartments if they wish to get quick, small-scale returns. They can prefer to invest in plots if they wish for long-term returns.