Land as an investment option has always been popular in India. Its popularity has not receded, despite the availability of various financial products such as mutual funds and equity shares. However, you should be aware of all the pros and cons before you go for investment in land.
The amount of money required to invest in land is substantial. Those with less savings, cannot afford to invest in land. Instead, they should opt for financial assets such as units of mutual funds, shares, recurring deposits or even gold. Moreover, investment in land is relatively illiquid and you cannot dispose of this investment as and when you want to encash it. In some cases, the time taken for the sale to actually happen, may run into years, thus, defeating the purpose of making the investment in the first place
Other than a few reclamation cases, the supply of land is limited and the possibility of creating more, is quite impossible. Due to its limited supply and the ever-increasing need, the demand for land has only been going up. However, this continuous demand has ensured that the price of land hasn’t experienced volatile changes like with other assets like gold and equity
There has been a rapid rise in population living in cities,with ever growing population in cities,cities are expanding at a pace unmatched,the small towns,villages which were never part of a city get absorbed as population increases,this increases land cost.