The next week was spent debating on what I need to do about the plot. I already lived in a lovely rented apartment very close to office. My spouse had an ancesteral house that we intended to live in/ build on someday. So should I sell the plot and invest in an apartment? Or should I build in it and live there? Or should I build it and rent it out? Or should I just let it lie there and sell it after a couple of years. Capital gain! One whole week of going back and forth on various decisions.
Now let me tell you how I arrived at the idea of finally building a house on the plot for rent.
Location of the plot - Lets say close to Koramangala inner ring road. The rental incomes in these areas are quite high as the location is very close to most offices. Now why wouldn't I want to stay there? Because my spouse's ancesteral property is in a much better location. So in the long run we would finally want to settle there. Why wouldn't I just let it lie there and wait for capital appreciation? Because I need a way to reduce the tax burden (IT Act allows for deduction of principal and interest on home loan). Also I need to feel like I am making an asset. Why would I not buy an apartment instead? Because the cost of a decent 2BHK these days is minimum 32-45 lakhs. The rental income from the flat can range from 10-15K p.m. The alternative is to use the same amount to build a house with two floors and rent it out instead. The rental income would be 2 times the apartment as it has two floors! So all in all it seemed like a feasible option. (P.S. My mom was keen I build there as well... it was her ancesteral property, so that swung my decision too)
Now let me tell you how I arrived at the idea of finally building a house on the plot for rent.
Location of the plot - Lets say close to Koramangala inner ring road. The rental incomes in these areas are quite high as the location is very close to most offices. Now why wouldn't I want to stay there? Because my spouse's ancesteral property is in a much better location. So in the long run we would finally want to settle there. Why wouldn't I just let it lie there and wait for capital appreciation? Because I need a way to reduce the tax burden (IT Act allows for deduction of principal and interest on home loan). Also I need to feel like I am making an asset. Why would I not buy an apartment instead? Because the cost of a decent 2BHK these days is minimum 32-45 lakhs. The rental income from the flat can range from 10-15K p.m. The alternative is to use the same amount to build a house with two floors and rent it out instead. The rental income would be 2 times the apartment as it has two floors! So all in all it seemed like a feasible option. (P.S. My mom was keen I build there as well... it was her ancesteral property, so that swung my decision too)
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