Dr Atul Goel, MD Goel Ganga Group & President Elect, NAREDCO, Pune
Property investment is a time-tested and one of the most secure investment instruments in India. Whenever a common citizen has surplus money to invest, real estate generally remains the first option to be considered and explored. No doubt, in terms of long term security and handsome returns, there are only a few competitors of real estate. However, before making a decision to invest in property, there are some key factors that a must be taken into account. The investors must factor in the following points before finalizing a property.
If you are investing your hard-earned money for investment purposes or for self-use, location is the primary factor of consideration. The return on the investment potential of the property is directly proportional to its location, ambience, neighbourhood and connectivity. If a property is too remotely located, the ROI potential will decline proportionately. It must be ensured that the location is well connected to social amenities such as schools, hospitals and markets.
The investor must be convinced that the location is served by the connectivity means readily and is reachable. Even if the property is for self-use, the location will remain the paramount factor for finalizing the property.
Despite stringent checks by the Real Estate Regulatory Authority (RERA), the cases of land and property-related frauds keep appearing in the newspapers. The real estate investor must ascertain that the property in question is duly approved and all the documents are in place. Some of the key approvals to check are encumbrance certificate, power of attorney (PoA), completion certificate, municipal approval, fire NOC, RERA registration and so on. In the absence of the required approvals, the investor might be at the receiving end in case of disputes or legal exigencies.
In the times of RERA administered regime, the absence of RERA registration raises doubts in the minds of investors. Before investing in or shortlisting a property, an investor must consider the track record of the real estate developer. The property investor must endeavour to go for an established and reputed developer as it minimizes the chances of fraud and unnecessary delays in property acquisition. As reputed developers have experience in delivering multiple projects successfully, the investor can expect timely delivery.
Finances and Home Loans
If you are considering a property investment, finance is one of the most important aspects of the process. You must be well aware of the sources of finances to buy the property. If you have the entire money at your disposal, well and good. However, if you plan to take a home loan, you must be aware of the payment plan or conditions of the developers. In most cases, the payment is made in accordance with the construction status of the property. If the property is ready to move in, you must ensure that you get the possession as soon as you deposit the money.
If taking a home loan is on your mind, it is always suggested to do good research about the loan interest rates. You must explore all the options and select the financial institution which offers the lowest rate of interest. However, you must be on guard about the hidden charges ,if any.
In addition to banking institutions, non-banking finance companies and housing development companies also offer loans at attractive rates. However, you must be doubly sure of the legitimacy of such agencies.
In summation, in addition to being a financially intensive decision, property investment is also an emotionally intensive decision. Investors must keep in mind the aforementioned factors for a safe and profitable investment in property.