Investing in appreciating assets is an excellent way to grow your wealth and earn a profit, provided you have the patience to wait for the long term benefits. Out of all the various investment opportunities, real estate can be one of the most lucrative. However, investing in real estate is not a decision to make lightly. It requires a good deal of capital and you need to have at least some idea of what you’re doing. Talking to experts in the real estate market is definitely a good idea if you’re interested in investing but don’t know enough about the market. Because real estate markets fluctuate on a regular basis, timing your investments is important. According to Business Today, the price of property in India has been appreciating over the past number of years; combined with the depreciation of the Rupee compared to the US Dollar, investing in the real estate sector has become much more affordable for overseas Indians. If you live and work outside of India, now could be an excellent time to invest in some property. If you live in-country however, you might need to tread a little carefully and really do some research to see if it’s worth the investment. One way to get some of the information you might need is to contact real estate agencies like Unitech Group. Regardless of where you live, here are some important tips to keep in mind when looking to invest in real estate.
Type of Property
When you first decide to invest in real estate, the first decision you need to make is to decide what kind of property you wish to purchase. Residential, commercial, and even industrial properties can be potential investment opportunities provided you have the money necessary. According to Realty Times, the range of different properties available in India has been increasing, allowing you to pick what kind of property you want and plan accordingly. Once you’ve decided what type of real estate you wish to invest in, you need to budget around that and can focus your property search more effectively.
Location
The old adage of “location, location, location” is still very much alive and true today. The success of your real estate investment can very heavily depend upon where the property is located. Ramesh Nair, the COO of real estate investment management company Jones Lang LaSalle told The Economic Times, “Investors need to establish the soundness of the location and its demand/supply dynamics. If they do not engage in sufficient research, they may end up buying into micro markets which have or will have high vacancies.” Investing in property without thoroughly researching the location can lead to disastrous consequences. Buying in bad locations can completely squander your investment.
Infrastructure
This is connected to the need for research on property location. Money Control states that some of the key aspects of property markets you need to investigate deal with infrastrcture. You need to check what sort of infrastructure is already there and functioning along with what sort of future growth and expansion might come to that particular market. The level of social infrastructure is important as well as it, combined with demand for commercial space, can lead to job creation as more businesses move into the area. According to Money Control, taking these critical market triggers into account provides a list of six cities where residential property investment could be most lucrative: Hyderabad, Bangalore, Chennai, Pune, Noida, and Navi Mumbai.
Diversification
Once again, the old adage, “don’t put all your eggs in one basket” still rings true. Investing all your capital into one location can work out, but if that one investment falls through, then you can lose everything. Diversification is just as important in real estate investment as it is in a stock portfolio. According to Nirrtigo, buying commercial property and renting it out can provide a good, steady cash flow; a lull in the market during retirement however, can spell disaster for your investment and your finances. Diversifying your investments can mean owning real estate and stocks or if you’re set on sticking to real estate you can purchase various differing properties. If your main investment is in commercial property, perhaps you should look into investing in residential markets or raw land. There’s nothing preventing you from investing in condos, apartments, and office buildings at the same time.
Market Fluctuations
The last but not least tip is to keep an eye on the market you’re going to buy into. Even if you’ve already purchased the property, keeping an eye on the market and trying to calculate the future market value of your investment is important. If it looks like the value might take a significant dip, then you might want to contemplate selling while you can make a profit and purchasing again at a later date. Realty Times highly suggests removing all doubts about property you want to invest in. If you have any questions or concerns about a property you are thinking of buying, then it’s imperative you contact the seller and clear up your concerns.
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