4 Reasons Why Investing in a 1BHK Apartment Makes Perfect Sense

 

Introduction

Investing in real estate is a significant decision that requires careful consideration. If you are contemplating purchasing a property, a 1BHK (one bedroom, hall, and kitchen) apartment can be an excellent option to explore. In this blog post, we will outline four compelling reasons why investing in a 1BHK apartment can be a wise choice.

1. Affordability:

One of the most significant advantages of a 1BHK apartment is its affordability. As a first-time homebuyer or someone on a budget, a 1BHK apartment serves as an ideal starter home. The smaller unit size translates to lower costs, including a reduced down payment and smaller equated monthly installments (EMIs). Moreover, 1BHK units often fall under the affordable housing segment, which received infrastructure status in the Budget 2017-18. This classification enables low-income group households to avail subsidised home loans when purchasing smaller units, making it an attractive option for aspiring homeowners.

2. Demand-Supply Economy:

While 2BHK apartments tend to be more popular among homebuyers, the demand for 1BHK units is comparatively lower. However, in cities such as Mumbai, where property prices have soared, the demand for 1BHK apartments remains substantial. This lower demand results in a surplus supply of 1BHK units, giving homebuyers the opportunity to negotiate favorable prices. Additionally, developers with excess inventory often provide incentives like club memberships, waived maintenance costs, or exemptions from Goods and Services Tax (GST) to encourage the sale of these smaller units. With the government contemplating levying taxes on unsold inventory, now is an opportune time to invest in 1BHK apartments.

3. Lower Utility Costs:

In recent times, the Maharashtra government has waived off property tax for houses sized under 500 sqft. For houses ranging from 500 sqft to 700 sqft, property owners enjoy a 60% reduction in property tax. This favorable policy change significantly lowers the overall cost of owning a 1BHK apartment. Furthermore, the utility and maintenance costs of smaller spaces are relatively lower, providing homeowners with ongoing savings.

4.Rentability:

The rental market also favors 1BHK apartments, making them an attractive investment for individuals seeking monthly income. Young couples, bachelors, and migrants in cities such as Bengaluru, Delhi, Gurgaon, Hyderabad, Mumbai, and Noida often prefer smaller units due to their affordable rents. The high demand for rental properties in these cities ensures a steady stream of tenants, offering an excellent opportunity for investors to earn passive income.

Coclusion

Investing in a 1BHK apartment can be a prudent decision for various reasons. The affordability factor, coupled with the demand-supply dynamics, makes 1BHK units an excellent choice for first-time homebuyers and budget-conscious individuals. Moreover, the lower utility costs and the potential for generating rental income further enhance the investment appeal of these apartments. As with any real estate investment, it is crucial to conduct thorough research, evaluate the location, and consider personal requirements before making a final decision. By weighing the benefits and carefully analyzing the market conditions, you can make an informed choice and embark on a rewarding investment journey with a 1BHK apartment.