Land Investment: Plots Of Disputes, Dreams And Development

Plots of land have carried not just people’s dreams and development, but also dramatic serial plots.

Of course, only when a huge chunk of family property is given to a random stranger in the will, does the family realise there was a lost sibling all along. One's family property has always held the power to bring ‘plot-twists’ and disputes that extend the family feuds over to multiple episodes.

These prolonged battles to hold a portion of the humble soil, work on television only because land has held its place as a prestigious asset in people’s minds for decades.

Most people have always envisioned holding land as a glorified ambition. This vision might not be as easy to maintain as an investment, according to experts.

The process of documentation, protection of the premise against encroachments, and confusions hidden in fine print, might become pricey to uphold, said Harsh Parikh, partner at Khaitan & Co.

The process and cost behind the purchase, litigation processes and protection of premise from encroachment makes land a very high maintenance asset, according to Parikh.

Parikh explains that the complete ownership change and ensuring that the process of litigation happens smoothly involves third parties who need to be compensated as well.

Further, the government does not protect the premise that an individual owns, which means that the cost of protecting the land becomes the responsibility of the owner.

With most people buying land in the outskirts, the cost of travelling there or setting up camera surveillance systems are connected costs that people may not have provisions for, according to Mohit Gang, the chief executive officer of Moneyfront.

“Owning land is like owning an unlisted equity or a blank cheque,” Gang said.

More than 15% over 20 years would be a fair expectation, according to him, but land is not an easy investment, he said.

Holding on to land is only ideal if one is sure that they can provide the resources to supervise and protect the land, according to Gang.

To conclude, buying land is a big decision that needs to be taken after considering the time, effort and finance you are willing to put into it.