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Older apartments versus new projects: Which offers better returns for property investors?
A Reddit debate among Bengaluru residents suggests older flats may offer higher rental yields than newer projects, despite the appeal of modern amenities
A Bengaluru resident recently sparked a debate on whether older apartments offer better investment value than newly launched projects. The user argued that 15-20-year-old apartments often yield around 4% or more, compared to 2-3% for many new developments. Established neighbourhoods, lower vacancy risks and greater room for price negotiation were cited as additional advantages.
“...rental yield on older apartments seems higher. Around 4% in some cases. Plus the area is already developed, so vacancy is low. I also feel it’s easier to negotiate a better deal with resale owners. Newer projects on the other hand are giving 2 to 3% rental at best. And prices are honestly crazy even for category B builders,” the Reddit post said,
The discussion prompted a broader question: if older apartments deliver stronger rental returns, why do investors continue to favour new launches despite soaring property prices?
Older apartments may offer higher rental yields and better location
Several participants agreed that older apartments can offer superior rental yields because their purchase prices are relatively lower while rental demand remains stable in established localities.
Others pointed out that older projects are often located in mature neighbourhoods with better social infrastructure, public transport connectivity, schools, hospitals and commercial hubs. These factors can help keep vacancy levels low and sustain rental demand.
Lower purchase cost, but higher maintenance
Some users noted that older apartments are usually available at a discount compared to new projects and often come with well-established resident communities.
However, the lower entry price may be offset by maintenance concerns. Older buildings can require repairs, upgrades and higher upkeep costs over time. Buyers may also encounter issues with plumbing, electrical systems, elevators, and common infrastructure.
“Older apartments will have issues and upgrades to work through, but the location will be relatively prime with better public access/infra,” a Redditor said.
“Older apartments usually cost less and may have strong communities already formed, but they can have hidden maintenance issues. New apartments come with modern design, amenities, and fewer immediate repairs. If resale or rental matters, newer well-maintained projects closer to transit and jobs usually hold value better,” the post noted.
Redevelopment potential
Another advantage frequently associated with older apartments is redevelopment.
As buildings age, redevelopment opportunities can emerge, particularly in land-constrained markets. Redevelopment projects can significantly enhance property values by providing larger homes, modern amenities and additional compensation to existing owners.
For some investors, redevelopment potential forms an important part of the investment thesis when purchasing older properties, the post noted.
“Yes, by what I understand (may be wrong) , the resale value of older properties stagnate and hence you may find it a little economical buying those, given you are ready to pay for the regular maintenence cost. Also older building go into redevelopment at some point of time and the redevelopment adds great value to these older apartments,” a Redditor noted.
Construction quality may vary
Some Redditors observed that older buildings often exhibit superior construction quality compared to certain newer projects. However, they stressed that a building's age alone does not determine its quality.
“The age of the building is not the only factor that determines the quality of construction. In South Bombay there are 100-year old buildings that are well maintained so the quality of the structure depends on original quality+maintenance. Most of the buildings built in the 80s in Mumbai are falling apart because of poor quality cement,” a Redditor noted.
Well-maintained heritage and decades-old buildings in prime locations continue to command strong demand, while poor construction quality can affect both older and newer developments alike. Long-term maintenance and management remain critical factors, the post said.
Should you buy a new apartment?
A recurring argument in favour of new projects was the availability of modern amenities.
Many buyers today prioritise facilities such as clubhouses, gyms, swimming pools, children's play areas, EV charging stations and enhanced security systems. According to some users, younger homebuyers and tenants are increasingly willing to pay a premium for such amenities, which can support both capital appreciation and rental demand.
One Redditor argued that comparisons should not be limited to older and newer properties, but also include projects offering similar levels of facilities. In many cases, newer developments command higher valuations because they cater to changing lifestyle preferences.
“The comparison should be between basic apartment without lift. basic with lift or with facilities. Most new buildings have life and the upmarket ones have facilities like gym and swimming pool. IF the purpose is to buy for rent or investment, you need to look at the preferences of the new generation. The old generations are typically not buyers unless they are downsizing. Most of the new generation want facilities and are willing to pay for it,” the post noted, adding that the appreciation is most in the building with facilities. As the value goes up the rental yield also rises.
What real estate experts say
Property consultants say resale homes are often more affordable than new launches, offer immediate possession and allow buyers to assess the property's condition and neighbourhood before purchase. Older apartments in established locations can also come at a 10-13% discount while offering strong connectivity, mature infrastructure and proximity to workplaces, schools and hospitals.
However, older properties may face challenges such as depreciation, higher maintenance costs, limited amenities, parking constraints and, in some cases, financing hurdles.
New homes typically offer modern layouts, lifestyle amenities, sustainability features and better infrastructure, but often command a premium and may involve construction and delivery risks.
Experts say the choice ultimately depends on a buyer's priorities. Older apartments can deliver stronger rental yields, lower acquisition costs and redevelopment potential, while newer projects may offer better long-term appreciation and appeal to tenants seeking modern amenities.
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For buyers prioritising location and affordability, older homes in established neighbourhoods can be attractive, whereas those focused on future growth may find greater value in newer developments on the city's outskirts.
(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.)
