A massive boom in real estate market since last 50 years is the key reason to attract investors across the globe. Investing in real market has been relatively popular compared to high on liquidity asset of gold. This can be a short and long time investment option, depending on the investor and their specific requirements.
Despite the recession and economic downturn, the real estate market continues to outshine many other investment options, with guaranteed return on investment during resale or renting the property.Considering the present volatile condition of the market, real estate sector continues to grow on a consistent basis with ample of investment schemes for public.
Evaluating with other investment choices, the real estate market involves a favourable risk but with low liquidity quotient for trouble-freeentry and exit. This feature enables you to fetch high return value during selling ofany investments made in buying land, flat, studio apartment or an real estate in guntur.
Variety of investment options available in real-estatecan be perplexing for a first-time investor, for which they must position themselves uniquely with adequate planning and market research. This will help them identify multiple asset options that can be scrutinized later with compliance to personal choices, requirements and affordability. Depending on the tenure of investment, real estate companies and consultants,engage with potential buyers to understand the investing purpose in view to provide customized solutions for people.
Points to consider
When you are buying, selling or renting any property, make sure the current market position and the price are known in advanceto avoid any complexities during legal agreements.
1. Location of the Property
“Location, location, location” is the customary punch line which still rules the market and remains a significant aspect ofproductivityin real estate investments. Nearness to amenities, important locations, landmarks, comforting areas, scenic views, peaceful, neighbourhood status and much more are important factors for housing valuation of the property; while connectivity to warehouses, markets, freeways, transport hubs, tax holiday areas, etc play an imperative role in valuation of commercial property.
What to look for?
An unambiguous view concerning, how the area is expected to develop during the investment phase. Today an open and peaceful land at the front and back side of the property may get evolved into loud manufacturing facility, making the valuations of the residential property decline the actual worth. It’s recommended to conduct check about type, ownership and intended use of free land, establishments and neighbouring areas in the close vicinity.
2. Investment Purpose & Horizon
Given to the fact, real estate market is known for high-cost investment and low liquidity. Lackinglucidity on purposemay cause unexpected financial distress, more so if the asset is mortgaged.
What to look for
Defining a clear position for yourself from below mentioned categories will help you near to the purpose and plan accordingly:
Buy forSelf-use: Self utilization benefit, value appreciation and saving rentals
Buy & Lease: Long term cost appreciation andregular income. It requires the mindset of the landlord to deal with legal issues & possible disputes, repair and maintenance works, managing tenants, etc.
Sell (Short Term): Guaranteed profit in small to mediocre range, applicable usually for buying properties under construction and selling for slightly high value once ready.
Sell (Long Term): Large fundamental value appreciation over a huge span of time. This can be the perfect solution for visible future aims like child’s education, retirement planning and more.
3. Valuation of the Property
Financing for real estate purchase, investment analysis, listing during sale, taxation and insurance premium- depends on property valuation
What to look for
Regularly used Property Valuation Methodologies comprise of:
Sales Comparison: Current sale value of properties with related characteristics- mostly suitable and common for new and old properties
Income: Depending on the regular cash inflows- apt for lease
Cost: The total cost summation less the depreciation- appropriate for new anedifice
The author is an expert Real estate consultant. He has contributed various writings on different aspects of Real estate market which includes articles like loan sanction, mortgaging refinancing, favourable time to investment, Tips for first-time buyers and all about the property market.