By: Chintan Sheth
Your real estate investment is likely to be the single biggest purchase of your lifetime. Thus, in readiness for this journey, being well-informed and having a deliberate approach is crucial. With a large portion of one’s life savings used as a foundation in this asset creation, here are some of the best practice guidelines that need to be considered before making a property investment decision.
Property Type
In the realm of real estate, there exists a diverse range of properties such as under-construction, ready-to-move-in, and resale properties. Handpicking the chosen one hinges on your financial goals, predilection, fiscal position and time you are mentally prepared to wait. Each kind bears its distinct pros and cons, which calls for a comprehensive understanding before choosing the best option that fulfills one’s aspirations.
Under-construction properties are those which have just been launched or are being built. The comparatively reduced initial costs are an advantage here. Furthermore, they offer flexible payment schedules allowing you to plan and accommodate all your financial commitments including home loans. However, as these take time to be fully developed, calling for thorough due diligence of the developer’s track record is inevitable to be sure of the timely completion of the project.
In contrast, the ready-to-move-in properties, as the name suggests, are fully constructed and available for immediate occupation. It calls for upfront settlement of the property purchase, thus having an impact on your immediate financial outlay.
Before engaging in a transaction involving resale property, verify the property’s legal status to ensure your investment is a safe and legitimate one.
Location
The location of the property is an important determinant in the process of home-buying. Start the selection process by evaluating the safety and security parameters of the neighborhood. Delve into details about the property’s proximity to public transport networks and arterial routes nearby, as connectivity is a key prerequisite for a sound property investment. If your intent is personal use, assess the convenience factor near your potential abode in terms of educational and medical centers, daily necessities, and recreational facilities. Last but not least, analyze the growth prospects of the locale. The future trajectory of the area can be estimated by the upcoming developments in that area.
Developer
Choosing the right developer needs meticulous thinking. The developer brand name is a testament to the project design, its quality concerning construction standards, and adherence to steadfast compliance with legal aspects including possession timelines. A reputed developer is committed to maintaining high standards and driving excellence through his projects. This bolsters consumer confidence and shields stakeholders’ investments.
Due diligence
Choose only projects that are under the aegis of the Real Estate (Regulation and Development) Act (RERA). Before investing, meticulously assess the project’s permissions, blueprint, any litigation involved, etc. When considering under-construction projects, leverage the RERA portal to check the quarterly progress reports (QPRs) uploaded by developers detailing project status.
In the context of resale projects, scrutinize the seller’s background. Taking help from a legal professional to validate the property documents is highly recommended.
Financial Planning
It is essential to be conscious of a concrete budget before initiating a property search. The allocation should take into account, initial down payment, stamp duty, registration charges, EMI affordability, and the home loan processing fees among other pertinent fees. Since arriving at the right quantum involves matching aspirations with fiscal feasibility, it may be prudent to consult a professional financial advisor. They can share detailed insights on balancing ambitions with the financial implications of the various facets of your life, helping you make an informed decision.
Redevelopment
Redevelopment can be described as the transformative reconstruction of a property, thereby leading to a change in the area itself. This is encouraged because it enhances the quality and functionality of the project, thereby amplifying the value of the locality. With realty spaces getting saturated and the government backing redevelopment earnestly, vertical redevelopment projects are revitalizing urban spaces.
One of the benefits of investing in a redevelopment area is the potential it showcases for increased property value as compared to newer locales. Redevelopment projects have established or improved infrastructure like the presence of reputed educational institutions, railway stations, metro stations, etc., and facilities that have a positive impact on the real estate landscape.
If you are contemplating a property investment in a redevelopment venture, carefully review the terms and conditions of the new development. Ensure that it complies with all the mandatory permissions as any deviation from that can upend you with legal complications. Historically, redevelopments have encountered various challenges, and the implementation of recent regulatory changes has resulted in them becoming an important segment.
Ultimately, investing in real estate is not only a financial decision but also an emotional one. It is essential to be pragmatic and patient when evaluating the above factors to ensure that your real estate investment proliferates and serves its purpose of growth and security for the long term.
