A Guide to Investments in Indian Real Estate

The real estate market has been traditionally an the best investment option as a whole and an investment opportunity for high net-worth individuals and financial institutions as well as those seeking viable options for investing money among real estate, property, bullion and many other options.

Investment in property to earn money and for capital growth will provide steady and predictable income returns similar to bonds, which offer a steady yield on investment, especially if the it is rented out as well with the potential for capital appreciation. Like all other investment choices Real estate investment comes with certain risks associated with it, which is quite different from other investment options. Investment opportunities available to investors can be broadly classified into commercial retail and office space.

Investment scenario in real estate

If you are considering investing in real estate investment should take into account the risks associated with it. This type of investment comes with the highest price for entry and is plagued by a lack of liquidity and an uncertain time frame for gestation. To being illiquid it is not possible to sell pieces of his property (as one could have done by selling units of bonds, equities or even mutual funds) in the event of an the need for funds to be urgently needed.

The maturity period of investment in property is not certain. Investors must also check the clear property title particularly for investments in India. The experts have stated that investing in property should only be carried out by those with a larger budget and a longer-term view of their investments. In terms of long-term financial return viewpoint, it’s advisable to invest in commercial properties. Visit:- https://connoisseur-realty.com/

The property market’s returns are comparable to that of specific index funds and stocks over the long run. Any investor seeking to balance his portfolio can now take a look at the property sector as a secure method of investment that comes with a amount of risk and volatility. The right tenant, the geographical location, segmental categories of the Indian market for property and the individual risks will determine the main factors in achieving the intended yields of investments.

The introduction of REMF (Real Estate Mutual Funds) and REIT (Real Estate Investment Trust) will increase the value of these real estate investments from a small investor’s point of view. This will allow smaller investors to enter the real estate market with contribution as less as 10,000 INR.

Additionally, there is a demand and need from different market players in the property segment to gradually loosen the rules for FDI in this sector. Foreign investments will mean higher standards of quality infrastructure and hence would change the entire market scenario in terms of professionalism and competition of market players.

In the end, real estate is anticipated to be a good investment alternative to stocks and bonds over the coming years. The appeal of real estate investments could be enhanced by the combination of favorable inflation rates and a low interest rates.

Looking forward, it is possible that , with the advancement towards the possible opening up of the mutual funds for real estate business and the inclusion of financial institutions to the property investment this will open the way for more organized investment real estate in India and could be an apt way investors could have an alternative option to invest in property portfolios at marginal amount.

Investor’s Profile

The two active investor segments are High Net Worth Individuals (HNIs) and Financial Institutions. While the institutions traditionally tend to favor commercial investments, high net worth individuals show interest in investing in residential as well as commercial properties.

Beyond that, is the third one the Non-Resident Indians (NRIs). There is a strong bias towards investing in residential properties over commercial properties owned by NRIs This could be explained by the emotional bond and future security sought by the NRIs. The procedures and documentation required to purchase immovable properties , other than plantation and agricultural properties are relatively easy and the rental income can be easily transferred to countries outside India, NRIs have increased their involvement as investors in real estate

Foreign direct investments (FDIs) in real estate comprise a tiny proportion of all investments because there are limitations that include the minimum lock-in period 3 years or a certain size of property to be developed and conditional exit. Beyond these restrictions the foreign investor must deal with numerous agencies and interpret complicated laws and bylaws.

The idea of Real Estate Investment Trust (REIT) is nearing the point of being made available in India. Like many other innovative financial instruments, there will to be some issues in order for this concept to be accepted.

Real Estate Investment Trust (REIT) is a company dedicated to owning and, more often operating income-producing real property, such as retail centres, apartments warehouses, offices and other warehouses. The REIT is a business that buys, develops, handles and disposes of real estate properties, and allows investors to put money into a professionally managed inventory of real estate.