2 BHK in Bangalore

2 BHK in Bangalore

2BHK – Best Real Estate Investment

Real Estate Investment is one of the most preferred investment options for Indians.

Every unit size has its own advantages and disadvantages. Real Estate Investment should be based on logic, reasoning & proper research. Before we share why 2 Bedroom is best Real Estate Investment option let’s check why 1 Bedroom and 3 Bedroom are not the best options for Real Estate Investment.

1BHK as Real Estate Investment: The biggest disadvantage of 1 Bedroom is that target audience of 1 Bedroom is people from lower strata of society. Usually investors would like to deal with middle class. 1 Bedroom is not preferred for Real Estate Investment as you may face problems while renting out or getting your house empty. Moreover you will find 1 Bedroom flats only from small time builders with dubious reputation. Any decent or known builder will not provide 1 Bedroom flat in the apartment complex. There are other reasons also like burden on common amenities; people desire to stay with alike income group etc. 1 Bedroom is normally bought by end users. Finally, rate of appreciation of 1 Bedroom lags behind other unit size therefore investors don’t prefer 1 Bedroom for Real Estate Investment.

 

3BHK as Real Estate Investment: One factor which work against 3 Bedroom is rent differential. A 3 Bedroom may cost 50% more than 2 Bedroom but rent differential is hardly 20%. It is not ideal scenario for investor. Even though investors buy for appreciation but potential rent earning is key factor while deciding unit size. These days’ builders are playing very smart. You will find 3 Bedroom of 1200 sq ft which is technically ideal size for 2 Bedroom. By converting 2 Bedroom to 3 Bedroom, he plays with Psychic of a person and charge premium. A 1200 sq ft 3 Bedroom looks congested and is very tough to rent or sell. 3 Bedroom is still considered luxury and target audience is very limited. For 3 Bedroom, target audience is mostly family with 2 Kids or with old parents.

Best Real Estate Investment

No awards for guessing…The award for top real estate investment goes to 2 Bedroom unit size. Some of the factors working in favor of 2 Bedroom as best Real Estate Investment option are

 

(a) Target Audience of 2 Bedroom is much wider compared to 1 Bedroom and 3 Bedroom unit size. Typical Target audience is Nuclear family with or without kids / Parents. With the changing socio-economic dynamics of the society and swelling migrant population, the demand of 2 Bedrooms will sky rocket in the coming days.

 

(b) Affordability is another major driving force in favor of 2 Bedroom. 2 Bedroom is very easy to rent or sell due to affordability. Even Big & Reputed builders like Hiranandani, Brigade, Mantri, etc have increased share of 2 Bedroom units in their upcoming projects. Some builders are even launching projects with concept of Premium 2 Bedroom units which are intelligently priced between normal 2BHK and 3 Bedroom.

(c) Be Practical: One of my friends working for reputed MNC bought 3 Bedroom flat in Bangalore. I advised him to go for 2 Bedroom as his job is mobile i.e. he is company’s favorite for overseas assignment. As i anticipated, within 3 months of buying 3 Bedroom he was deputed on overseas assignment for 3 years. He found difficult to rent 3 Bedroom and compromised on rent. He is getting rent almost equivalent to 2 Bedroom. It is advisable to buy 2 Bedroom if your job is mobile. 2 Bedroom can be easily put on rent or sell.

 

(d) Last but not the least, the maintenance cost of 2 Bedroom is lower than 3 Bedroom therefore recurring hole in pocket is less. 3 Bedroom of bigger size with maintenance based on per sq ft model will significantly increase monthly maintenance charges thus net rent received will be less. In short, higher maintenance charges means lower net rent received.