Property Investment In India In 2021
A complete guide to know how, when and which property to invest in India in 2021
Property investment is a long-term reward most individuals aspire to benefit from in their lives. While aspirations lead the human mind by want, a flinching thought looms the mind of where to start and what points to consider while investing in real estate?
Keep reading to know where to start while making such an investment, and the contributing factors that make you a smart real estate investor.
Where To Start When Thinking Of Investing In Properties In India?
(Take note of the list of essentials, before owning a property in India!)
Before jumping the gun and looking up property investment and listing sites, give thorough thought to your decision of investing in real estate. Here’s an exclusive “Pre-lease Property 5-step Guide” that we would like to share, made for every investor, before loosening the strings of his/her purse.
Step 1: Deciding on THE property
We emphasis on “THE” sole because we know the importance and exhilaration of making the first house or buying the first commercial space. With India being such an expansive and expanding country, investors need to be smart while buying the property.
Keep in mind
1. Location of the property
2. Age of the property
3. Rental rates of and around the property
4. Living cost of the area in which the property is in, and
5. The convenience of the property
Being able to get at least 3 of the above points struck off from the list, can be said to be a smart investment of the buyer.
Step 2: Lucidity of Budget
The banking sector in India has made it enormously easy for buyers to invest in property in India. The low-interest rates, minimum document requirement, and the ease of repaying loans have attracted millions to turn their attention towards real estate investment.
One needs to come up with a plan to strategically plan the investment in terms of calculating the loan amount required vs the amount in-hand, interest to-be-paid, and years it would take to completely pay off the loan.
Being overboard with the budget may perhaps not be such a hassle, however, neglecting other responsibilities and needs of a household may be. So, be careful, logical, and lucid about the budget of your property investment.
Step 3: Estimating the loan procedure
It takes almost 3–4 weeks to get a home loan processed. In some cases, it may take a week less or more, depending on various factors and the nature of the sale.
A buyer must be eligible for the loan, provide all necessary documents, get sanctions from various financial and legal institutions of India, and other formalities.
Apart from these, property investment is a matter of sorts. It may take days for an official to sign a piece of document or minutes for the funds to transfer. So keep a window of getting the possession of your property, accordingly.
Step 4: Valuation for resale
Whenever an investment is made, it is done with an intention of benefitting from its actual value. This holds majorly true for investment in real estate.
Try to find a property that holds a strong resale value in the future. Look at the infrastructural growth of the area, distance from the main city, nature of the commercial investment, and sustainability of the project in the next 10–15 years.
Step 5: Cost-to-self factor
This is one factor most of us miss out on while buying a new property. There are multiple smaller and hidden costs involved while buying a property in India.
We made a list of costs to keep in mind while making a real estate investment. Take a look!
- Stamp duty cost
- Registration cost
- Transfer charge
- Municipality charges
- Property insurance
- Real estate agent commission
- Notary
- Lawyer/Consultant fees
- Property tax
Factors that make a smart real estate investor!
(Reasons for giving property investment a real thought!)
Let’s quickly run through the contributing factors that may classify an investor on being smart when it comes to buying real estate!
- Know the market before planning your investment.
- Get in touch with recent property investors to understand the nitty-gritty of real estate investment.
- Plan for the future by researching projects and understanding their sustainability.
- Narrow down your search to a specific domain of investment. For eg., Premium housing projects, agricultural land for farming, unit houses, etc.
- 3Cs of being a smart real estate investor: Concerns, Complaints & Compliments. Read, listen and analyze the 3Cs to make an informed decision.
- Recognize the risk and volatility of your property’s investment.
- Comply with property laws of India, and check for the authenticity of the builder, site, loan provider, financial institution, and more.
Summing Up
Investing in real estate is like vacillating between risks and returns. What makes this investment a sweet glory is the research and understanding of real estate. If you’re unsure about an investment, try leasing the property for about a year to test waters. It will give you a fair idea about how to go about property investment in India.
