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The prices of residential plots across eight major Indian cities went up by an average of 7% annually since 2015, while rates of apartments only increased by 2%, reported news agency PTI quoting a report by realty portal Housing.com.

"Prices of residential plots appreciated by 7% (CAGR) annually since 2015 across eight major cities, while rates of apartments grew by 2% (CAGR) annually during this period," the portal said.

This shows, said Housing.com, that residential land continues to be a better investment than apartments as plots generated higher capital returns in Delhi-NCR, Mumbai, Pune, Bengaluru, Hyderabad, Chennai, Kolkata and Ahmedabad.

Across these eight cities, Housing.com said that people generally prefer to buy apartments than plots.

The reasons behind the popularity of flats are security and common amenities like power backup, car parking, club, gym, swimming pool and garden area, among others.

Despite this, Housing.com head of research Ankita Sood highlighted that key localities in Gurugram and the southern states comprising of Hyderabad, Bengaluru, and Chennai recorded double-digit growth in prices for residential plots post 2018.

Where prices for land in these cities grew in the range of 13-21% in the last three years, apartment prices have remained range-bound (2-65), she added.

In the Gurugram market of Delhi-NCR, the prices for residential plots grew by 15% (CAGR) during 2018-2021, according to the statement.

The land prices in Sohna, Gurugram, grew by 6% (CAGR) during the same period, it added.

In the Delhi-NCR market, many developers have launched plots and independent floors to meet the rising demand for such properties.

Realty firms DLF, Godrej Properties, M3M, Signature Global, Raheja Developers, Gaurs Group, Supertech and Trehan Group, among others, are selling such properties in Gurugram, Noida, Greater Noida, Faridabad and Ghaziabad.

"Residential plots have been able to generate higher returns on investment. One of the reasons could be the limited supply of plots in big cities because of the paucity of large land parcels in the city," said Dhruv Agarwala, CEO of Housing.com, Makaan.com and PropTiger.com.

The demand for plots and independent floors have come back strongly during the Covid-19 pandemic, he said.

Agarwala informed that developers have been trying to meet this rise in demand by launching such projects on the outskirts of big cities.

On the report, RK Arora, Chairman, Supertech Ltd, said the prices of plots have gone up by as much as 20-25% in the last couple of years in Noida, Greater Noida and Yamuna Expressway region.

The announcement of Jewar airport has been one of the major factors to drive demand and prices, he added. 

With inputs from agencies. 

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