There are many people around us who can share their property investment ideas. At some point in lives, almost everyone has experienced property dealing. We have seen our parents, friends, or siblings buy properties. It has been a new learning for us. But if you want to know more about real estate in India, then self-indulgence is quite important. If you are thinking about making an investment in the Indian real estate business, then there are a few things that you should know in advance.
What are some simple ways to invest in real estate in India? How can a beginner know everything about property investment as a pro?—This is what we will be discussing in this article.
Real Estate Investment Tips for Beginners
- Estimate affordability
One of the costliest investments in one’s life, real estate property is also the most profitable investment as it involves a lot of money. Ranging from few lakhs to many crores, you will find diverse property prices in India. Therefore, before anything else, first ask yourself this important question—What is my budget? How much should I spend in a property purchase?
Factors playing major role in getting you a home loan include your income, savings capability, credit rating, etc. Getting a loan becomes very difficult if one does not have a reasonably high credit score.
Then there are statutory charges associated with real estate investment that increase the cost of property purchase. Costing nearly ten percent extra, these charges further affect one’s affordability.
Typical break up of statutory charges is shown below:
- Stamp Duty (6%)
- Advocate Fees (0.1%)
- Home Loan Processing Fees (0.1%)
- Tax Deducted At Source (TDS-1%)
- Society Administration Charges (1%)
- Registration (0.5%)
- Brokerage (0.5%)
- Prepare For home loan
Check your credit score because if it’s low, then you have to take steps to improve it. Banks do not give loan if your credit score is low. Therefore, you should check your score before you apply for a loan. You can do so for free on CIBIL’s website. Along with the credit scores, banks also check your EMI paying capability by going through other documents. It would be better if you keep the below-mentioned documents handy:
- Address proof
- Identity proof
- Income tax Return (ITR) of last year
- Bank statements (of last six months)
- Latest salary slips (of last six months)
- Statement of assets (financial and physical)
- Other documents as asked by the bank
One’s home loan eligibility is decided by a combination of credit score and EMI paying capability.
So how can one enhance their loan eligibility? One can do so by trying to make other loans zero (credit card debt, personal loan, etc.) before applying for a loan. Even before starting your search for a property, it would be a good idea to obtain home loan eligibility letter from bank.
- Check the builder’s reputation
A good investment is a combination of a cost-effective property and a good developer.
Before putting your money anywhere, finding out the reputation of the builder is crucial. There are some developers who have a history of last minute changes, work delays, bad quality construction, etc. Some of the attributes of a good developer are as follows:
- Timely completion
- Excellent construction quality
- Good flat layout (inside design)
- Quality project layout (outside ambience)
- Superb quality of installed fittings (lighting, faucets etc.)
It is very important that your money is in safe hands. A reliable builder will keep his promises and handover the key to you as decided in the beginning.
Whether you are looking to invest in residential properties or commercial properties, consider Omaxe Group. It is one of India’s leading and trusted real estate companies and has delivered 11.72 million meter square space in real estate and construction contracting. Founded in 1987 by Mr. Rohtas Goel, the brand ‘Omaxe’ has secured a high position in construction and contracting business. The company was diversified into real estate sector in the year 2001.