A quick-guide to becoming a successful real estate investor
Real estate is one of the most rewarding ways to expand your wealth as compared to all other investments like Gold, Stocks and Mutual Funds. It is a great way for diversifying your investment portfolio, as it diversifies your income sources and majorly adds to your positive cash-flow stream. You invest big and you reap big! That’s how the real estate investment landscape works. But in order to make fruitful investments and reap those rewards in a steady and sustainable fashion, you need to become a patient, diligent and market savvy investor… you need to become a true real estate investor!
Getting ready for the real estate investment game
Are you excited to buy your first property? That’s great. Let’s see what will it take to make you successful in this game and stay ahead of the curve at all times. We have created a simple categorized guide that will enable you to make your first successful purchase, and set you up for a thriving real estate investment career.
Guide to becoming a successful investor:
1. Getting Savvy:
Real estate is one investment landscape where every decision involves extensive planning. It’s never a straightforward decision and there are many financial and non-financial parameters involved that take you to your perfect deal. To create an effective plan, it’s critical that you understand various aspects of real estate buying and selling to its fullest extent. You need to become extremely knowledgeable, in order to develop the savviness that will make you successful
Let’s take a look at a few important aspects:
a. Loan rates: This is for people who are not using their complete savings to make their first purchase or any subsequent purchase. Do extensive research about home loan and property loan offers from all known banks, before finalizing. This will help you in finding the right loan deal which is favourable as per your terms and may also shed some light on any useful loan schemes offered by various banks.
b. Market rates: Researching market rates for various types of properties across multiple builders gives you a clear perspective as to what should be the ideal property price. This allows you to have a leverage when it comes down to negotiating your price
c. Latest Trends: Real estate is an ever-evolving field as it is not just a commodity or a necessity, it’s also a lifestyle choice. Even though you are just buying it for the sake of investment and not living, people view houses and commercial spaces as a lifestyle symbol. Stay on top of what kind of amenities, features or services are in popular demand, so that you make purchases that are valuable in the future.
d. Tax Benefits: Real estate investments in India are allowed for tax exemptions. You can save taxes on the interest amount and principal amount of the loans taken (if any) under section 24 and 80 C, along with the capital gains you get from your property sale.
2. Choosing location:
Location is essential for budgeting your real estate investment. A 2BHK flat in one locality may cost a little or much less than a similar 2 BHK in another locality. Your location defines your investment angle. Whether you are going for a residential or a commercial property, location plays an integral role for each.
Different neighbourhoods and localities offer different types of lifestyles. A neighbourhood abundant in nightlife and malls might appeal to a younger crowd. And young people are mostly interested in renting apartments, rather than buying them. That means, you have more chances of getting quality tenants rather than getting quality buyers. A quiet neighbourhood with ample restaurants, educational institutes and convenience stores (grocery, medical) might appeal to families looking to buy a starter home.
Just like residential properties, location is of great importance to commercial spaces as well. Commercial spaces are mostly rented up by businesses who have different needs. For some businesses, it is highly important to have a mall, reputed (5 star) hotels and airports in close proximity. These kinds of businesses would ideally get spaces in well-equipped IT parks, which have great connectivity to various parts of the city. For some businesses like start-ups, having ample space with great amenities could be enough…that maybe in any part of the city.
3. Creating a strategy:
This is the part where you think… what is really your thing? Are you an investor who thinks long-term for every investment, or someone who is wanting to quickly cash-in on a hot opportunity? Once you decide on this, you can follow certain guidelines pertaining to that particular strategy, in order to ensure a smooth growth in both scenarios.
1. Short-term strategy (Flipping):
Buying properties at their lowest and selling them at their highest! Well, that’s the goal but in order to do that in short timeframes, its best to stick to limited options.
a. No or negligible rework: You are not buying this property to rent it out to anyone, right? So, it’s best to go for properties that require no or negligible investments in terms of rework and repairs. This way, you can maximize your profit margins.
b. High-end: You have a budget for your property that you have carefully devised based on the location/locality. Its best to spend on the higher range of that budget in order to get hold of premium properties, as their value increases much faster than other properties. For example, a flagship apartment in any particular housing society will be the first choice for every interested buyer.
c. Ready-to-move: If you are going for newly constructed projects, its best to choose properties that are completely ready-to-move. This immediately turns your property into a hot listing in the market and will allow you to sell it off in a heartbeat at great market-level rates.
2. Long-term strategy:
Playing the long game? The entire real estate field is your playground. When you’re in this for the long term, you need to think in terms of having multiple sources of income and highly valuable assets at hand when you retire. Think of it as building a portfolio of valuable investments.
a. Diversification: The first rule of real estate investments is to diversify your investments. This keeps your income safe from market fluctuations/crashes as all types of real estate properties are not affected at any given point of time.
b. Commercial spaces: This is a time where young professionals are highly aspired to run their own businesses and start-ups. Investing in a viable commercial space is great for long-term as it will keep yielding high returns in terms of rent and does not demand much up keep.
c. Apartments with amenities: Gone are the days where amenities like swimming pools and health clubs are deemed as luxury features. Every buyer or tenant wants to live in a property that promotes an active and a stylish lifestyle. Go for apartments that offer at least some premium amenities, apart from the standard facilities.
d. Attract high rents: Rent is going to be a major part of your income in the future. In order to attract high paying tenants, you can furnish your properties with standard appliances and do minor upgrades [electrical and plumbing] so that you have better chances of demanding more rent and getting long-term tenants, as most tenants like sticking to one place if they’ve found a good one.
For those investors looking to invest in high-end residential apartments and premium office spaces, you can check outBramhaCorp properties. They are a leading developer brand in Pune offering a multitude of high-end projects across various prime locations. Here are 2 of their flagship projects;
1. The Collection: An upcoming residentialproject in the New Kalyani Nagar Pune. This venture is set to push the luxury lifestyle standard even higher as,BramhaCorp is offering 2&3-bedroom ultra-lux residential apartments.
To know more, you can visit www.bramhacorp.in/the-collection
2. BramhaCorpBusiness Park: Located at the prime location of New Kalyani Nagar,BramhaCorp Business Park offers elite commercial spaces that come with the state-of-the-art amenities and facilities at reasonable process. The building offers excellent connectivity to Pune Airport, all major malls, IT parks and hotels of Pune.
To know more, you can visit https://www.bramhacorp.in/business-park-pune