Real estate is a long term investment that one makes in his/her lifetime. And, it is easy for an investor with no prior real estate experience to get carried away, but keep in mind this investment comes with certain risks and you can also get into real estate investments that offer no returns.
So, here are five important things that a first-time investor should keep in mind while buying a property:
- RERA Registration: While property hunting you must always remember to check if the housing project is a Real Estate Regulatory Authority (RERA) registered. You can verify the RERA number and approvals online or through local municipal authorities.
- Check other costs: While choosing a particular property you must remember to compare things like monthly maintenance charges, amenities like security, social clubs), electricity supply, water charges, etc., these costs may later take a toll on you. So, you must keep these added expenses in mind and check if it suits your budget. You should also compare the market prices of other ready-to-move-in or under-construction projects, along with the brand value of the developer is also important for future valuation as well as the infrastructure of the building.
- Plan your budget: Establish a budget before you start looking for properties. It should ideally be within your loan re-payment capacity without hampering your essential needs. A broker or agent may persuade you to spend more and make speculations of higher returns, however, it cannot outweigh the damage from defaulting on your home loan re-payment.
- Type of property: Before you invest in real estate, be clear about what you want to do with the property – earn rental income, own use, or investment re-sale value. Having these points clear will help you judge a property better. Depending on your purposes, you need to calculate return on investment over the short or long-term.
- Tax liability: For first time home buyers, there are attractive housing loan incentives offered by the government. House owners get interest rate benefits under the PM Awas Yojana. Additionally, there are tax benefits on home loan interest rate under Section 24 and on principal payment under Section 80C along with payments towards registration and stamp duty.
As for your developer, before you sign any documents related to the purchase of a house, make sure you read the fine print on the liabilities of the developer.
(Source: Times Now)
