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Tips For New Investors in Real Estate

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Suhana Jain
Tips For New Investors in Real Estate

Introduction

The Indian real estate market has grown at a breakneck pace over the last couple of years. Even when the real estate space has registered a dip globally, this particular sector in India has thrived. The industry continues to reap rich dividends for builders and developers.

If you have decided to invest in the real estate sector in India, you must know that it can be a highly profitable space to get into. However, the amount of success you get in the real estate sector in India would depend on how well you understand it and the kind of moves you make.

Here are some important tips for new investors in real estate:

Know Your Market

While having a broad view of things is necessary, what is even more important is to have a solid understanding of real estate builders & construction company in your local market. Without knowing about the different elements associated with the local market and the way they are operating at a given point in time, it would not be advisable to invest in real estate.

When you have just stepped into the real estate space as a potential investor, it would be a good idea to stay away from the hot markets for a while. When new investor puts their money at the top of the pile, there is a chance of them losing it all. Your investment should be driven by the kind of behaviour the market is exhibiting at the moment. There are various builders and developers in the market for your Research.

Explore The Hidden Market

Whether you are planning to buy a house or a property that can be converted into an office space, you will get many options to choose from. This is where you need to play your moves smartly and consider some of the properties that nobody has set their eyes on. When you explore certain hidden markets, you increase the chances of finding your desired property at a reasonable price as there are plenty of competitive builders and developers  there in the market.

Whether you are planning to invest or operate as a housing developer, it would be a very good idea to look for properties that are owned by individuals who are a little distressed for some reason. An individual, who might be in a hurry to sell their property so that they could move abroad, might not have listed it in the marketplace. When you buy such property from them and promise to pay immediately, you might get it at a price that is lower than its market value.

Control Your Risks

Even before you step into the real estate market and get in touch with various builders and developers as an investor, you must know about some of the ways in which you can control your risks. One of the things you need to remember is that raising a lot of money as debt is a bad idea. When you are planning to buy a property and sell it later, you must make it a point to pay 10% of it right away.

If you pay a higher percentage of money upfront, you can do away with private mortgage insurance. It also leads you towards paying a lower rate of interest on the loan. It would also serve you well to have a large cash reserve at your disposal. When you have a sufficient amount of cash, you should not hurry to sell the property you have acquired. You can sell it at the right time at a high price.

Study Your Costs

Before you invest in any kind of property, you must analyse your costs thoroughly with the help of builders and developers. While many new investors think that having an understanding of realtor commissions and the property’s cost is enough, there are many other elements you need to be aware of. There are many other expenses you have to take into account before and after paying for a property.

If the property you have bought is in need of repair, you have to pay for it as well. Before you reach out to a professional agency for repair-based work, you must ask them to give you an estimate and figure out whether it fits your budget or not. There are several utility costs that you have to take into account as well.

Check The Timing

Real estate builders & construction company believe that the monetary value of a property increases with time. However, some factors could also result in the property’s value declining over a period of time. You have to analyse various factors and figure out what would be the best time to invest in a particular property. If you think now is the best time to buy it, then go for it. If not, then it would be a good idea to wait for a while.

Timing is very important when it comes to buying or selling a property directly from Builders and Developers. If a seller is selling a particular property, located in a desolated area, at a price that happens to be higher than its market value, you might be apprehensive about investing in it. However, if major commercial properties have been planned to be set up in this area, then you can sell this property in the future at a much higher price.

Verify The Legalities

Sometimes, a lucrative property can lead you towards locking a deal immediately and acquiring it after paying the seller the amount they had asked for it. However, before you buy any property from a housing developer, you must go through all the documents and certifications pertaining to it. Being aware of the legalities will help you safeguard yourself against a lot of things that could get you in trouble.

If you buy a property from a seller but then, somebody comes up toyou and shows you documents that point towards them being its owner, it would result in a very messy situation. A situation like this could lead to a legal battle that goes on for years. Before you invest in any property, you must ensure that it will not get you into any kind of legal hassle.

Do Not Overbuild

As a new investor, when you seek guidance from real estate builders and construction company, they might caution you to stay away from indulging in overbuilding. A lot of new investors have a lot of energy and enthusiasm. Because of this, they spend a lot of money on rebuilding or renovating a property after acquiring it.

When you are clear about your goal of selling a property you have acquired in the near future, overbuilding it is one mistake you must avoid making. Sometimes, people spend so much money on renovation or furnishing a property that they are forced to sell at a loss in the future. Renovation or rebuilding should be looked upon as an investment and you must be sure about recovering it.

Maximize The Property’s Value

When you want to make a healthy profit out of a property that you have acquired, you have to spruce it up a bit. By taking some simple steps, you can increase its value considerably and sell it at a good price. You must remember that spending your own money is not the only way to maximize a property’s value. You can also do with striking profitable deals.

When you have acquired a property to rent it out to an organization as an office space, you could think of a few things you can install nearby to make the area more valuable for its employees. You can set up a small cafeteria where the employees can come over for a quick bite or reach out to a bank to get an ATM installed close to the property.

Conclusion

When you are about to make your first-ever investment througha housing developer in the real estate sector, you are bound to feel a little nervous. If you have already taken a decision, you might question it repeatedly and wonder whether you are heading in the right direction.

One of the best things a new investor can do is to buy a property through a real estate group that has a lot of credibilities. If you are looking for a reputed real estate group in India through which you can make your investments, you should reach out to Ace Group India.

For more Details, kindly visit our website – www.acegroupindia.com

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