Real estate has by far been one of the most preferred investments for the long term. Over the past few years, urban cities in India have witnessed a fast-paced infrastructure development that has led to the massive growth of the suburban areas. There are various factors one needs to be mindful while investing in real estate:
- Location:Location is key to any property investment. Check the chances of value appreciation of your flat by evaluating demand for property in the area and upcoming projects in the locality. This is always the most crucial aspect when seeking a property for investment. Hence a thorough understanding and inspection of the location are vital when looking at long-term investment.
- Valuation of property:Once you have chosen a location, it is important to understand the valuation of the property, as insurance premiums, investment analysis, taxation, depreciation, and the future growth and returns on the property will largely depend on the base valuation. Cost of the property, the loans, and the depreciation amount needs to all be understood properly to arrive at the right valuation.
- Features and amenities:While some under-construction or completed properties boast of amenities that will be added to or improved upon later, it is wise to scrutinise the entire property from a feature and amenity point of view, to understand the ease of living and the probable benefit if seeking a rental income. From elevators and open spaces for children and senior citizens to quality fittings in bathrooms and safe electrical wiring etc., are all equally important. Check other value-adding facilities available inside the project premises (swimming pool, gymnasium, community halls etc.).
- Documentation and Ownership:Check legal documents like title deed, occupational certificate etc. Make sure the project is not stuck in any kind of litigation. Once you zero in on the flat, shift your focus on the paperwork. Firstly, look for RERA registration as that is the first stamp of approval. RERA approves a project only if it has all approvals from municipal corporation, electricity and water department. These make for a high-value investment as it allows one to own the piece of land and not just the home.
- Appreciation potential:This is another vital factor when selecting a property for investment. Appreciation potential for the property can vary depending on the market scenarios and the development pace of the area. However, in the case of long-term investment, one needs to be assured of substantial growth as this is a high value and moderate risk investment. Factors like big-ticket infrastructure development (Mega Highways, Airports or metros and elevated connected corridors etc.) or proposed commercial/ business hub in the neighbourhood, can be big accelerators for the appreciation of the property.