Are you investing in Real Estate? Then Read this first.
Gone are the days when people could settle in a piece of land or locality without having to pay for it. Today, every square foot has a monetary value attached to it and real estate is a preferred avenue for investment.
Investing in a real estate property is often a dream for the middle level income groups and a habit for the higher income groups. While it is a very common to invest your funds, but one must be very cautious while investing in properties. If anything go wrong in the invested property, not only does it result in a loss of money, but also shatters hopes and dreams. It is therefore not only wise, but also vital to check for a number of conditions while purchasing property.
The 17 criteria that are mentioned below are to be carefully analysed while investing in a real estate property.
1. Reputation of the seller/previous owner.
The first and foremost condition to be verified while investing in real estate is the reputation and goodwill of the seller or the previous owner of the property. A huge number of fraudulent properties can be eliminated by cross verifying the credibility of the selling party.
A number of documents, approvals and licenses will have to be verified before finalising the property. This includes Title Deed, Approval by local bodies, Property Tax receipts etc. All these documents and paperwork will have to be scrutinised very carefully and with legal help.
Investing in real estate is a financially huge move for the person investing. A thorough knowledge about various available sources of finance must first be identified, and later, the best choice i.e, the one with lower interest rates, easy repayment facilities, safety, etc. must be opt for.
4. Competitor Analysis
Before fixing on a particular property, one must analyse the competition in that industry. Several players exist in the real estate business and the buyer must analyse every single one of the potential sellers before making a decision.
5. Do the calculations yourself
While having a broker/agent, it is very important that you don’t blindly trust the calculations they tell you, but you do the calculations yourself and double verify it. Often, the quoted cost doesn’t include the charges of a number of items like Parking charges, Service charges, etc. It is thus important to calculate the total cost involved in making the investment.
6. Personal verification of the site
It is a prerequisite that you personally visit the site rather than going only by the brochures and advertisements. A number of defects can be identified if one compares the property that is advertised and the actual site.
7. Understanding your need
Understanding personal needs is important while deciding the property. The sellers might try to convince you to go for a bigger/smaller plot, but you must always stick to what you need.
8. Know your affordability
Not everyone can afford every property. Know and understand the extent to which you can afford, without over burdening yourself with debts. When one is aware of his affordability levels, closing on the investment choices becomes easier.
9. Future developments
The buyer should consider the future development prospects of the area in which he decides to invest. Almost all sellers/builders promise that the particular area will flourish and boom. But it is the responsibility of the buyer to verify the same.
10. Talk to people who’ve already purchased
It is always wise to talk to people who have already purchased property, preferably at the same location and the same builder, in order to understand their experience and difficulties, if any. This mentally prepares the buyer for what lies ahead.
11. Compensations available
Delay in handing over the property is a common problem faced by sellers. The seller must be aware of the various compensations available to him in case of such delays. Few of these compensations include seeking a refund, filing a case in the consumer dispute redressal commission etc.
12. Amenities offered
One has to have a clear idea on various features/amenities offered by the builder/seller. Sellers often project a number of facilities which may simply be an eye wash. Analysing such projected features is essential before making the purchase.
13. Check for reserved land
Make sure the property that is sold to you is not reserved for the government. Though one might think no seller would do this, there have been instances where the same has happened.
14. Accessibility to Schools, Hospitals etc.
You must analyse the accessibility of basic places like Schools, Hospitals, Banks etc., while deciding your property’s location. The importance of connectivity to such places is well known.
15. Potential for Resale
People often forget to think about this very important criterion while purchasing a property. Just because people like you and many others purchase it now doesn’t mean they’ll buy the same property in the future.
16. Quality of materials used
If you are going to purchase an apartment, make a thorough check of the various raw materials used like the quality of bricks, cement, tiles etc. Aspects like wiring, fitting etc., must also be checked.
17. Environmental conditions
The property that you purchase today might become the place where you will live tomorrow. Therefore, it is essential to check the environmental conditions of that area. Pollution levels, availability of pure water are few of the conditions to be looked at.
Investing in a property is economically a HUGE upgrade. One must be cautious and wise while deciding the same. Happy Investing!
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