WHAT ARE THE FACTORS INFLUENCING THE PRICE OF PLOTS?

Introduction

The real estate sector is one of the most vied after sector for both buyers and sellers. This is true, especially in India where the business of dealing with real estate that includes plots, apartments under construction or ready-to-move in apartments, villas or community housing projects, as well as commercial projects are generally in high demand. The sector also generates vast employment, albeit highly unorganized in India unlike other countries where you need to be certified. The economic and political development is closely linked with the development of the real estate market. Rapid urbanization and development of infrastructure projects along with investment in retail, hospitality, and information technology make it a hot bed for demand and supply of land and resources. This in turn has an impact on prices of property depending on the location, projected growth, and other surrounding factors.

Factors that influence the price of Plots

Any investor must first take up a thorough analysis of the market before venturing into large investments. The more well-informed you are, the more beneficial your investment decisions will be since the market is volatile. It is recommended that a fair valuation of the property is carried out to ensure a fair deal. The investor must also understand or atleast keep in tune with the current market to make the right investment at the right time. The price of property or a plot is influenced by its availability not just in the market, but also in the required location. If there is a heavy buying in a prime area for example, then it is only reasonable to determine that the price of the property will increase since demand is high and supply is less.

Changes in demographics are huge drivers of property prices. If there are more takers in a particular area, maybe for its location, status, and infrastructure, then prices will be pushed up. On the contrary, property prices outside the city are expected to be much lower in comparison since they are still in the early stages of development.

The price of land only continues to appreciate in value and this has been the case for over the past two decades. Land is precious and can be used for a host of purposes. So the value of a property constructed over a piece of land is hugely influenced by land prices. The land value or price of plots is dependent on not just the location, but also the quality of soil, the climate, environmental sustainability such as ground water levels and green cover. For example, if the land is fertile, then it is valued more even if there are no other distinguishing features. Add to this, the development of road linkages, highways, and other prominent landmarks in turn drums up land prices.

Another factor that influences pricing of plots is government regulations that lay out the kind of development that can be carried out on the land. For example, if land can be used only for large scale industrial development, then it obviously attracts a higher price.