Buying own house is every Indians dream and there is nothing wrong in this vision. After all, home is one of the basic needs of human life. However, the trouble starts when people get obsessed by real estate and go all out in making realty investments. In doing so, they forget the basic principle of diversification and invest all their money in property market. While, this can turn out to be a good decision in absolute long term, it can even backfire in medium to short term if the realty sector goes through a correctionor the market sentiment turns negative or the government comes out with some kind of law that is harsh on the sector. Hence, it is important to exercise caution when it comes to making decisions pertaining to property investment.
Property purchase should only be done following proper due diligence and research. The process must also take into account all of the administrative procedure, legal framework and return on investment. At the same time, it is also important to transact through a source that is credible, trusted, authentic and above all branded. One such medium is Housing.com, India’s leading online real estate portal to feature100% verified and genuine properties.The site also provides its users with thousands of properties that are amongst the best in market within all budget ranges, with all facilities and in all localities including property in Faridabad, Delhi, Mumbai, and 100 plus other cities across India. Having said this, over investment in any sector, be it equity, debt, bond, securities, gold or real estate must be avoided. This is because it can negatively impact in the long run. Let’s see why –
Limited infrastructure
Infrastructure is one of the biggest challenges in Indian property market and this is true across the spectrum. Nearly 65% of Indians believe that the facilities provided with their homes are inadequate and do not match their expectations. This includes basics such as parking, security, elevator, corridor walkway, etc. Also, the transportation facility to and fro from the workplace and educational institutes are poor and there are no proper healthcare facilities either. Additionally, there are several big projects developed in far fringe localities that do not even have proper eateries, restaurants, malls, departmental stores, etc. and investing in such project is filled with risk as there is no timeline to when will the original infrastructure come in.
Return on investment
Investing excessively in properties can also negatively impact the return on investment in the long run especially considering the point that the realty rates are not rising but multiplying every few years. This has rendered the average home buyer out of the market and eroded the customer base. As a result, liquidating the assets will become challenging unless the government comes with some method to streamline the price rise and arrest this issue.
Conclusion–While, property is and will remain a good investment in medium to long run, over leveraging must be avoided at all cost. Hence, it is advisable that an individual on an average must not have more than 4 to 5 real estate assets spread across different segments.
The world ” real estate” made the customers to think that land and houses are infallible reality of the market, but it is quite contrary to that assumption. When the recession was hit on the U.S., it was hit straight at reality market at first, then its domino effect began to spread across. While watching the plunged property values in some States of the U.S. like Nevada, Arizona, Florida, Georgia, South Carolina, Michigan etc, it will surprise us all; and the mere false confidence in the real estate market is now openly challenged. In the State of Georgia alone, 72… Read more »
A. S. Mathew, your comments to certain extent are correct but some figures are incorrect. For example the total UAE population is under 7 million and expatriates are roughly 80%, so you have the figures. What do you mean by 72 major and minor bags went under, you mean banks, well US had far too many banks than required, hence it was a good correction I suppose. Oil prices are currently low and expected to touch $40 per BBL in the short term and eventually expected to climb to $65 to $85 range, currently economies are at lower end of… Read more »