Buying a flat in India as an investment is a losing proposition, according to Wisdom Hatch founder Akshat Shrivastava. In a pointed post, he argues that the gains primarily benefit builders, not buyers, and calls for a rethink of how Indians view property purchases.
“There are three specific reasons why you should buy a flat,” he says. “First, to live in it. In that case, it’s not an investment—you love the place, you buy it. Second, if you can build a business on it, such as running an Airbnb, because that improves your yield. Third, if you’re getting a distressed deal where the long-term rental yield justifies the price. But this rarely happens in major cities in India anymore.”
His critique comes against the backdrop of India’s real estate market, which has witnessed significant but uneven price growth over the past few years.
In 2024, property prices in India’s top seven cities rose by an average of 21%, driven by increased input costs and strong demand. For instance, Delhi-NCR recorded a staggering 30% rise, with prices jumping from ₹5,800 per sq. ft. in 2023 to ₹7,550 per sq. ft. in 2024.
Experts predict a cooling-off period in 2025, with price growth expected to stabilize to single digits. Factors such as increasing land and construction costs, coupled with steady demand, are likely to prevent significant price declines.
Srivastava warns that speculative purchases based on recent price appreciation are a financial trap. “The worst reason to buy a flat is: ‘Oh, in the last three years, the prices have doubled, so you can imagine the next three years?’ Buddy, that’s the builder’s rate—what they can sell Tower B for now after completing Tower A—not the value of your three-year-old flat,” he remarked.