Are flats still a wealth creator? Homebuyers debate ageing homes, rising costs and redevelopment prospects

Homebuyers asked on social media if ageing flats are wealth creators or just homes, citing rising prices, maintenance, redevelopment hopes and rental returns

For decades, owning a flat has been regarded as a cornerstone of financial security for India’s middle class, often marketed as a safe, long-term investment that would appreciate in value and support future generations. However, as home prices soar, maintenance costs rise, and ageing buildings raise questions about resale and redevelopment, a growing number of buyers are beginning to ask whether apartments are truly investments or simply homes with a limited financial life.

For decades, flat ownership has symbolised financial security for India’s middle class, but rising prices, costs and ageing homes are prompting buyers to question their long-term investment value. (Representative Image) (Pexels )

A Reddit post warned that many buyers, including NRIs, assume an apartment will build long-term wealth, only to face the risk of poor resale or even illiquidity decades later. “The first home is a necessity in India, but the second flat onwards is just throwing money down the drain,” the user wrote, urging buyers to stop speculative purchases so prices can “normalise under real supply and demand.”

One of the Redditors said that even an independently built house in a small town, constructed with “the best materials,” began showing cracks and leaks within five years, pointing to expensive materials, costly labour, and a lack of skilled expertise as structural risks that can worsen in mass housing.

Others highlighted the burden of monthly maintenance in gated communities. “That amount is also appreciating every year,” a user said, referring to maintenance charges, adding that so-called sinking funds in Bengaluru are often spent on upgrades such as EV charging, solar panels and composting systems, instead of cushioning future costs.

Another user cautioned that after factoring in today’s high prices, taxes and maintenance, “holding it for 30–40 years, you are more likely to make a loss” compared to passive investments, even if flats appreciate in the early years.

Redevelopment, location can preserve value

Some pointed to Mumbai and Pune, where 30-year-old buildings are routinely redeveloped. “They get new flats at the same location with better access to offices and good rentals,” one Redditor wrote, arguing that value does not go to zero because owners retain a share of land.

Explaining the economics, the user noted that while the land share per owner may decrease when a building is redeveloped with more floors and units, residents receive a newer and often larger flat, while builders profit from selling additional apartments, calling it a “win-win for everyone.”

Location, many said, remains critical. Flats in established areas such as Delhi’s Dwarka and Vasant Kunj “will always hold value due to accessibility,” one user argued, contrasting this with oversupply risks in markets like Gurgaon and Noida. The user stated that owners in premium South and West Delhi neighbourhoods rarely sell unless forced, and that redevelopment, similar to Mumbai, could eventually lead to the lifting of older DDA flats as well.

Another user shared a real-life example, a 25-year-old flat in Banjara Hills, Hyderabad, bought for ₹10 lakh in 1999 and sold recently for ₹2 crore. “Old areas still have captive populations,” the user said, citing proximity to jobs, schools and family networks.

Returns, rentals and the ‘consumption asset’ view

Some users struck a middle ground, arguing that flats can generate returns in a limited window. “From pre-construction to about 10–15 years, you can make money,” one of the Redditors wrote, adding that good rental yield and shorter commutes, an “undervalued benefit," can tilt the equation in big cities.

Another Redditor shared that a flat bought for ₹40 lakh around 2010–11 now yields ₹26,000–27,000 a month in rent, translating to about a 6–7% net yield after costs, raising questions on whether such returns still justify ownership.

“Flats should be seen as a consumption asset first, not a guaranteed wealth creator,” one user said, noting that for many Indians, owning a first home offers stability and peace of mind that renting cannot. However, buying second or third flats purely as investments “often doesn’t make sense anymore at today’s prices.”

(Disclaimer: This report is based on user-generated content from social media. HT.com has not independently verified the claims and does not endorse them.)