If you get salary every month in your bank account, you think about one thing often. That thing is future. You want to make your money grow. You want to buy something that gives you more money back. Many salaried people think about property. But which property is the best investment property for salaried employees? This is a big question.
Let me tell you clearly. This article is for you. You work hard every day. You pay rent, EMIs, school fees, and home bills. After all this, you save some money. You want to put that saved money in a good place. Property is a good place. But you must choose the right property. If you choose the wrong property, you will lose money and peace.
I will not use any hard words. I will not use any English that makes your head hurt. I will talk like a friend who knows about property. Let us start.
Why Salaried Employees Need A Different Property?
A businessman can take risk. A businessman can wait for five years to see profit. But you cannot do that. You have a family. You have monthly expenses. You have a job that may or may not stay forever. So your investment property must be safe first, and then profitable.
Many property sellers will tell you to buy big land or big villa. Do not listen to them. They do not know your life. You need a property that gives you monthly rent. That rent should be enough to pay your home loan EMI. That is the best case. Your tenant pays for your property. You keep your salary for your family.
Let me give you a simple rule. A good investment property for a salaried person has four things. One, it gives rent every month without fail. Two, its price does not fall suddenly. Three, you can sell it fast if you need cash. Four, it saves your tax.
Now let me show you which property types have these four things.
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The best property type for salaried people
Small two bedroom flat in a good location
This is the number one answer. A two BHK flat between 600 to 900 square feet is the best investment property for salaried employees. Why? Because it is easy to rent. A small family, a newly married couple, or even three bachelors can rent this flat. You will never struggle to find a tenant.
Where should this flat be? It should be near a metro station, or near a big office area, or near a college and hospital. These three places always have people looking for rent. If your flat is walking distance from a metro, you will get renters lining up.
One more thing. Buy this flat in a building that is at least three years old. A new building has many problems. Water issue, electricity issue, society problems. By the third year, all these problems are solved. You can see the real condition of the flat and the building.
A small shop in a residential area
Many salaried people do not think about a shop. They think only about houses and flats. That is a mistake. A small 100 to 150 square feet shop in a busy residential area is a very good property. But you must be careful.
Do not buy a shop in a big mall. Big malls are risky. Many shops in malls stay empty for years. Instead, buy a small shop on the ground floor of a residential society. That shop can be a grocery store, a medical store, or a chai stall. These small shops never close. People in the society need these shops every day.
The rent from a shop is often higher than a flat. Also, the shop owner takes care of all maintenance. You just collect the rent. But one warning. A shop costs more than a flat for the same size. So you need a bigger home loan or more savings.
A builder floor in a good colony
In big cities like Delhi, Gurgaon, Bangalore, and Pune, you will find builder floors. These are small buildings with two or three floors. Each floor is a separate home. This is a very good choice for salaried employees.
Why is builder floor good? Because there is no big society with many rules. You do not have to pay high maintenance charges. Also, builder floors increase in value faster than big apartments. But you must check one thing. The land title must be clear. Many builder floors have land problems. Pay a good lawyer to check all papers before you buy.
A plot in a developing area on the city edge
This one is for salaried people who do not need rent right now. If you already have a home and you have extra savings, buy a small plot. The plot should be on the edge of the city, where new roads and new offices are coming.
Do not buy a big plot. Buy a small plot of 1000 to 1500 square feet. Keep it for five to seven years. When the city grows and reaches your plot, the price will become two or three times. But this is not for everyone. If you need rent every month, do not buy a plot. A plot gives no rent.
Which property to avoid completely?
Let me save you from loss. Many salaried employees make these mistakes. Do not repeat them.
Do not buy a big three or four BHK flat. Big flats are hard to rent. Only rich people rent big flats, and they can leave anytime. Your flat will stay empty for months.
Do not buy a property in a far away place just because it is cheap. If the property is far from offices, schools, and hospitals, no one will rent it. You will pay EMI every month but get no rent.
Do not buy under construction property. Builders will show you pretty pictures and promise you high returns. But many projects are late by years. Some projects never finish. You pay EMI on a flat that does not exist. This is a very big risk for a salaried person.
Do not buy a property in your hometown if you do not live there. You cannot check on it. You cannot find good tenants. Your relatives will live there for free. It is a headache.
How much money do you need
Let me talk about numbers now. Do not worry. Simple numbers only.
For a good two BHK flat in a city like Noida, Pune, Ahmedabad, or Chennai, the price is around 40 to 60 lakh rupees. For this flat, you will get rent of 15,000 to 20,000 rupees per month. Your home loan EMI for 20 years at 8.5 percent interest will be around 35,000 rupees per month for a 45 lakh loan.
You see the difference. Your EMI is 35,000. Your rent is 17,000. You have to pay 18,000 from your salary every month. This is okay because after 20 years, you own the flat fully. Also every year, the rent goes up a little. Your salary also goes up. After five years, the rent will become 25,000 and your EMI stays at 35,000. Then you pay only 10,000 from your pocket.
This is how property investment works for salaried people. You do not make profit in the first year. You make profit after ten years.
Tax benefits that help you
This part is very important. The government gives you benefits when you buy a property. As a salaried employee, you can save a lot of tax.
First, the home loan principal amount up to 1.5 lakh rupees is deducted from your income under section 80C. Second, the interest you pay on the home loan up to 2 lakh rupees is also deducted under section 24. If you take a joint loan with your wife, both of you can claim these benefits. That means you can save up to 3.5 lakh rupees of tax per year.
But remember one thing. These benefits are only for a property that is ready and you have taken possession. Under construction property does not give you these benefits until it is ready.
How to check if a property is good or not?
Before you put your hard earned money, do these five checks.
First, go to the property on a weekday morning. See the water supply. Turn on all taps. Flush the toilet. Many properties have very low water pressure. Do not buy that property.
Second, talk to neighbours. Ask them about the building and the area. Do not ask the owner or the broker. They will lie. Neighbours will tell you truth. Ask about floods, power cuts, and bad smell in the area.
Third, check the rental market. Go to a local property broker. Tell him you want to rent a flat like this. Ask him how much rent you will have to pay. If he says 15,000, then your rent will be 15,000. Do not believe the seller who says you will get 25,000 rent. Believe the rental broker.
Fourth, check loan approval. Before you pay any booking amount, go to a bank and ask for loan approval on that property. The bank will check all legal papers. If the bank says no, then do not buy. The bank knows more than you.
Fifth, check distance to office. If you are buying for yourself, see the travel time from the property to your office. If it is more than one hour in peak traffic, you will hate your life. Do not buy.
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FAQs
Can I buy a property if my salary is 50,000 per month?
Yes you can. But you must buy a cheaper property. Look for a property worth 25 to 30 lakh rupees. Your EMI will be around 22,000 per month. If you get rent of 12,000, you pay only 10,000 from your pocket. This is doable. But do not buy anything above 30 lakh on a 50,000 salary.
Is buying a property better than putting money in mutual fund?
Both are good. Mutual funds give better returns in five years. Property gives safety and rent. A salaried person should do both. Put some money in mutual funds and some in property. Do not put all money in one place.
Should I buy a property now or wait for prices to fall?
Do not wait. Property prices in good areas do not fall. They only stay same for two three years, then jump up. If you keep waiting, you will never buy. Start with a small property now.
What about buying a property with my brother or friend?
Do not buy a property with a friend. Never. With your real brother, only if your names are on the loan and both of you pay the EMI. Even then, be very clear about who gets how much rent and who pays how much tax. Write everything on a paper and sign.
Can a woman salaried employee get better loan?
Yes. Many banks give lower interest rate to women. Also stamp duty is lower for women in many states like Delhi, Rajasthan, and Punjab. If you are a working woman, you should use this benefit. Buy property in your name or joint with your husband.
A real example to make everything clear
Let me tell you about Mr Sharma. He works in a private company in Noida. His salary is 70,000 per month. In 2020, he bought a two BHK flat near Noida Electronic City Metro station. The price was 48 lakh rupees. He took a home loan of 40 lakh rupees. His EMI is 34,000 per month.
He gave the flat for rent at 17,000 per month. Every month he puts 17,000 from his pocket for the EMI. He saves tax of 1.8 lakh rupees every year on the home loan principal and interest. In 2024, the same flat is worth 65 lakh rupees. His rent is now 20,000 per month.
Mr Sharma is happy. He pays 14,000 from his pocket every month now. In five more years, his rent will be 25,000 and his EMI will be 34,000. Then he will pay only 9,000 from pocket. After twenty years, he will own a flat worth more than one crore. And he did not feel the pain of big payments because his tenant helped him.
This is the best investment property for salaried employees. A small two BHK flat in a good location with metro or office nearby.
Conclusion
Do not try to get rich fast. That is not for salaried people. You have a steady income. Use that to build a steady future. Buy one small property. Then after five years, buy another small property. Do not buy big properties. Do not buy under construction properties. Do not buy far away properties.
Take your time. Look at ten properties before you choose one. Ask questions. Check water, check papers, check rent. Take your husband or wife when you go to see the property. Two pairs of eyes see more than one.
And remember this. The best investment is not the one that gives highest return. The best investment is the one that lets you sleep well at night. A small flat with good rent and good location will let you sleep very well.
