Things to Consider When Investing in Real Estate
Real estate is one of the most commonly recognized sectors across the world. Housing, retail, hospitality, and commercial are its four sub-sectors. This sector has witnessed a drastic growth since the demand for office space as well as urban and semi-urban accommodations has increased.
In India, real estate is the second highest employment generator. There is a huge demand for commercial shops in Gurgaon. Bengaluru has been found to be the most favored property investment destination. Making an investment requires thorough research because of the risks associated with it.
Real estate will grow from Rs. 12,000 crores to Rs. 65,000 crores by 2040. Sub sectors like retail, hospitality, and commercial are growing significantly too. With a rise in demand for office space as well as residential areas, the Indian real estate sector has witnessed high growth. This sector is expected to grow from US$120 billion in 2017 to US$1 trillion by 2030 and also contribute 13% to the country’s GDP by 2025.
Below mentioned are some of the things to consider when investing in real estate:
Things to Consider
Investing in real estate is a life-changing decision and needs to be taken responsibly.
- Background Check– A thorough background check of the property is extremely important. Make sure the location of the property is suitable and that it isn’t constructed on disputed or unfit land. Checking if the property fulfills all the legal criteria is also crucial. For safe deals, go for builders like Adani Realty, who are trustworthy and have a good reputation.
- Expenses– Calculating all the expenses beforehand is always a smart move. An unforeseen expenditure is the last thing you need, especially if you are taking a loan. Hence, arranging the needed capital beforehand is necessary so that your finances stay in order.
- Your Credit Score– Your credit score can affect your ability to get a loan. Loans are disbursed at a higher rate of interest because of bad credit scores.
- Property Valuation– Listing price, Investment analysis, taxation, etc., all of these depend on real estate valuation.
- Purpose of Investment– Clarity on the purpose of investment will lead to expected results. Make sure to be clear in your head about the objective of investing. Whether you want to buy for self-use or to sell are two important considerations.
- Features– The features of the property such as the size, cost, how old it is, etc., are some important features to think about beforehand if you want to buy a 4BHK apartment for sale. The size of all the rooms, how old it is, is it in your budget, etc., are things you need to think about.
- Consider the Risks– Unlike stocks, you cannot sell real estate immediately when the market goes down or if you need cash. Considering all the risk factors beforehand is therefore crucial.
Investing in real estate is beneficial as with well-chosen assets, investors can make a predictable cash flow count and enjoy excellent returns and passive income. A real estate investment can provide competitive risk-adjusted returns and substantial appreciation as well. The major drawback in this sector is the lack of liquidity. It can take several months to fulfill a real estate transaction.