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Why is 2023 The Best Time To Invest in Real Estate

  • By catalyze capital

    23 Oct 2023 / Home
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Over the past couple of years, the Indian real estate market has demonstrated its resilience in the face of pandemic-induced challenges. Despite the impact of COVID-19, the sector has maintained a steady course, with Indian firms projected to raise a significant amount through infrastructure and real estate investment trusts in 2022. The market is segmented into various property types, including residential, office, retail, hospitality, and industrial, with different market values depending on the location. Cities like Delhi-NCR, Bengaluru, Mumbai, Pune, Chennai, and Hyderabad have emerged as high-grossing realty markets, while cities like Jaipur, Ahmedabad, and Chandigarh are also witnessing growth.

Optimistic sentiments prevail in the residential real estate market, with expectations of over six percent capital value growth in 2022. Factors such as reduced premium charges and stamp duty have contributed to this positive outlook, particularly in the mid-income housing sector. The government's allocation of funds for affordable housing schemes and favorable policies further boost the industry's growth prospects.

Investing in the Indian real estate sector in FY-2023 presents limitless opportunities for lucrative capital gains. To prepare for realty investments, individuals should first estimate their affordability by carefully considering factors such as mortgage payments, down payment requirements, estimated rental income, and price-to-income ratio. Setting property selection criteria is crucial, taking into account aspects like construction quality, location, market trends, and the type of real estate category (residential or commercial).

Evaluating the expected return on investment (ROI) is essential for making informed investment decisions. Different methods, such as the cost method and the out-of-pocket method, can be used to calculate ROI based on the property's equity, costs, and current market value. In addition to direct property investment, exploring allied industries like solar power, concrete, and paint can potentially enhance property value and returns.

Performing a thorough background check and due diligence is vital before finalizing any real estate transaction. It is important to investigate the builder's credentials, ensure necessary approvals are in place, understand applicable laws and taxation policies, and verify the project's registration with RERA. Attention to documentation, Commencement Certificate (CC), and Occupation Certificate (OC) for ready to move projects adds an extra layer of security.

By following these meticulous steps, real estate investors can position themselves for substantial capital gains. The industry is witnessing a shift towards greater systemization and unification, driven by efforts to reduce fragmentation. Established developers will strengthen their position in the market, attracting more investors, including NRIs and OCIs. With the desire for larger homes, a stable industry outlook, and a favorable investment climate, 2023 presents an opportune time to invest in Indian real estate. By exercising caution and making informed decisions, investors can maximize the potential of this thriving market.