For a Mumbai homebuyer living in a compact 1RK, the question of upgrading to a larger home can be as much about finances as it is about space. A recent Reddit discussion has brought this dilemma into focus, with users debating whether to sell the existing apartment and upgrade to a 1BHK or 2BHK or hold on to the current home and turn it into a rental property.
The buyer currently owns a 270 sq ft 1RK in Mumbai’s western suburbs, close to a metro station. With two new properties in the same project nearing possession within six months, the owner is weighing whether to upgrade to a larger 2BHK or opt for a 1BHK while retaining the existing apartment as an investment.
The math behind the two options
Under the first option, the homeowner is considering buying a 610 sq ft 2BHK for an all-inclusive ₹1.50 crore and selling the existing 1RK for ₹65 lakh. According to calculations shared on Reddit, the buyer would make a ₹75 lakh down payment and take a ₹10 lakh loan, with an estimated EMI of ₹24,000 a month for four years. The homeowner would forgo rental income from the 1RK under this option.
The second option involves buying a 445 sq ft 1BHK in the same project for ₹1.10 crore while retaining the existing 1RK. The buyer would again make a ₹75 lakh down payment but take a larger ₹35 lakh loan, resulting in an estimated EMI of ₹34,500 a month for 15 years. The existing 1RK would then be rented out, with the homeowner estimating a net rental income of around ₹18,000 per month after accounting for taxes, brokerage, and maintenance.
The Reddit user said the comparison was made purely from a financial and investment perspective, rather than from personal preference, space requirements, or lifestyle considerations. The homeowner asked users to assess which option would make more sense for overall net worth over 5-, 10-, or 15-year periods and whether any factors had been missed in the calculations.
Netizens react to the Reddit post
Several Reddit users suggested different approaches to the homebuyer’s dilemma. One recommended buying the 1BHK, while another suggested opting for the 2BHK and renting out the additional room.
The discussion centred on three possible strategies: retaining the existing 1RK to generate rental income, selling it to reduce the loan required for a 2BHK, or using the extra room in the larger home to generate rental income.
Redevelopment is also an option, say experts
Real estate experts suggested that homeowners living in older buildings should also explore redevelopment options.
Also Read: What is driving the growing interest of large corporates in Mumbai’s cluster redevelopment projects?
“If the 1 RK apartment is in an old building and the building is expected to undergo redevelopment, the homeowner should consider purchasing extra area above the area offered under redevelopment. The homeowner and the developer who will redevelop the building are both in a win-win situation here. Because the homeowner gets a discount from the developer, and the developer also gets initial cash flow for redevelopment,” said Ashish Patel, a real estate consultant from Mumbai’s western suburbs.
