Thirty years ago, investing in a real estate was never a necessity but a luxury, a medium to boast the social status. But now putting money into property market is not just imperative but a tried-and-tested way to grow your investment incessantly. Real estate is rather a money making cycle from where you can reap benefits till time attains infinity. For those, who still don’t believe in this statement, here are few reasons that will convince you:
‘There is no safer place than home’- Home is indeed the safest option to invest in. Reason being the returns and risk associated with it. Stocks and shares might give better returns over a period of three to four years but the risk associated with it is way too high. Shares and stock prices see huge variation even in a week but housing remains stable and hence safe over a longer period of time.
Ample finance options
There are ample options available for real estate financing. From banks to Non-Banking Financial Companies as well as private lenders, there is no dearth of money for a real estate investor.
Loans are cheapest
When compared to other assets, loans offered for homes are cheapest in India. A home loan is available for 9.25-11 per cent while auto loan is offered for 14 per cent while personal loans are offered for 15 per cent on an average. This makes home loans comparably cheaper.
Suits every need
Real estate suits every need and budget. If you are looking for long term capital growth, building a retirement home is a good option. For continuous income, buy a home where the rental flow is attractive and if you are looking for an addition to your portfolio, you can always buy an old home, available at a lower price and remodel it as per your choice. This would also raise its value.
It is a controlled asset
You might need to hire a broker if you are investing in shares and stocks but real estate investment is easy and simple. Property portals like Makaan.com are one stop destination to look for options and research about localities, get answers to all property related queries that an investor tends to have. Even if you are buying through a broker, it is a one-time payment while share brokers charge commission on an yearly basis.
Keep you ‘Financially Disciplined’
Real Estate actually keeps an investor financially disciplined. A fixed date for EMI payments keeps you motivated to arrange for the funds on time as late payment might involve a huge penalty. Moreover, one needs to keep up the holding costs as well keeping in mind the tax and rental income factors as well. All of this makes you more aware and urges you to have monetary dexterity.
It keeps on growing
Real Estate asset never stops growing. Once you buy it, the yield and returns tend to increase varying as per location. Even if you put it for rent, the capital price will continue to rise. For those who want to build their retirement nest have the winning edge as they can leverage rental income till the age of 58 and can sell it for lump sum amount to buy another property.
Benefits from other’s investment
Property prices increase whenever there is any infrastructure development or upgrade in amenities like new hospital or school or shopping complexes or business centre etc. Improvement in employment opportunities can boost housing demand in nearby areas. If the investment you made is in a suburb, improvement in accessibility can raise the property values as well as housing demand.
Pass it on to your next generation
Real Estate is one of those assets which you can pass on to your kids and generations to come. Whenever you think about long-term investment, it is not necessarily for your lifetime. You can pass this to your children and if well-positioned, property will continue to grow over the long term. There is no single company on National Stock Exchange which has topped the market for 10 years in a row.
Owning a property offers you a tax rebate. You can enjoy deduction of up to Rs 1,50,000 from taxable income in a financial year as payment towards housing loan. However, an enhanced deduction of up to Rs 2 lakh per annum for a self-occupied property can be availed of if acquisition or construction of the property is completed within three years from the end of the year in which the loan is taken.
Time would change but the benefits of investing in real estate are only going to increase. Not just that it is the safest haven but because it is an asset which is tangible and makes it more real. The ‘look-and-feel’ is comforting and its value is far more than any share or stock that has gone under.