Should I buy property or rent it – for my Clinic ?

POSTED BY abhijeet modi ON April 26, 2014 3:09 pm COMMENTS (3)


I am doctor, at present i am running my own clinic in rental space cine last 3 yrs.

now i need to expand it further so need more space for this. at present i have either of 2 option first, i go for rental space in same premises or purchase it near by new devloping location.

financial scenario: present rate is 12ooo with 10% rise every yr

new rent for minimum 5 yrs contract 30000 with 10% rise every yr

i finalized two different location for purchase of place. total project cost is  85 lacs at one place and other costing me 95 lacs.

i applied for loan in bank for around 75lacs at rate of 11% for tenure of 10 yrs, i find it difficult to get such amount of loan from bank so i need to arrange money from local source at rate of 12% . it was around 20lacs in first scenario.( in place of 85 lacs – project cost)

real estate rate rise about 25% in last 2 yrs in our area.

so please tell me which is better option for me.

3 replies on this article “Should I buy property or rent it – for my Clinic ?”

  1. ashalanshu says:

    Dear abhijeet, if your calculation indicates, purchasing is better, please opt it.



  2. abhijeet modi says:

    Thanks for reply,
    i made calculation for both.
    in tenure of 10 yrs
    i am giving interest of around 49 lacs and at same time will give rent of around 65 lacs in 10 yrs
    if i go for rent-
    i am able to invest around 8.8 lacs for 9 yrs and so on calculated for every year for period of ten yrs
    return i calculated for this amount was around 12%
    also consider for depriciation factor which was higher on purchase side for initial 5 years and then on rental side for next 10 yr
    at the end of 10 yrs i have a property in area if i go for purchase which was priced higher than i have capital in hand.
    so i am confused which was good way?

    thanking you

  3. ashalanshu says:

    Dear Abhijeet, renting is better that outright purchase to keep your capital investment down.



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