Which is better investment commercial or residential

The COVID 19 pandemic had briefly halted the pace of the real estate market in the country. Especially when it comes to buying and selling the numbers were very low. But the market is slightly better now. As far as investment in commercial or residential properties is concerned, there are various factors which I think would be important to consider before arriving at a decision. Some of the things to consider include:

• Return on investment

• Rental yield

• Capital appreciation

• Location of property

If we talk about ROI, the current market for commercial properties is slightly slow considering the work from home scenarios but the office spaces which are smaller in area say 500 sq ft will attract more tenants than a larger office space. Whereas, it was observed that people preferred to stay at residential flats which were slightly away from the city hustle and bustle. They preferred to be closer to nature and since rents of these properties are slightly low, it was a good deal for them. If you invest in a property which offers more amenities and is closer to nature, it is likely to be occupied easily.

But you cannot rule away the fact that offices are opening and the commercial cum residential market is bound to see more activity.

When it comes to location, obviously you will have to do the market research to understand how the experts see the growth of a particular area. For example, in Bangalore Sarjapur is growing tremendously and it has become one of the favourite spots for real estate investment. Similarly, Thane and Navi Mumbai in Maharashtra, Gurugram, Noida, Greater Noida and Faridabad are hotspots for the real estate market. The fact that the government is investing and infrastructure in these areas make them a good spot for investment.

Bottom line: You will have to make the choice based on how much are you willing to invest, what is your preferred location, what are your expectations from the property and much more. I would recommend you to contact experts in the field and make a wise decision.