Real Estate investment is definitely one of the most rewarding investments for our future safety and well-being. But we often overlook details which might lead us into investing into the wrong place. We should avoid making blunders and take care of a few things before making the decision to invest.
Real Estate investment is soaring
With the ever increasing population, the demand for more land keeps on increasing with each passing day. Every piece of land available is being converted for corporate offices, residential dwellings etc which has put an excessive pressure on the available resources.
Real Estate investing rewards with appreciation which is unmatched to any other form of investment. This is the reason why it attracts more people to invest as a secure asset for their future.
Common mistakes by Real Estate investors which should be avoided:
1. Not checking paperwork properly – There are many people who have been cheated by giving the investors fake documents. The documentation has to be in place before the investor gives away any amount to the real estate agent/ builder. There is a possibility that people might not check and verify the documents before signing them. This could result in them losing the property also. The documents need to be double-checked and verified before one makes a wrong decision. The documents must be up to date and scrutinised well.
2. Not calculating the costs – One invests in real estate to earn profit. So a thorough calculation needs to be done on the amount which will be invested and the appreciation earned in future. Underestimating costs can land one in trouble. Taxes, government fees and registration charges associated with a property should also be kept in mind before you buy that property.
3. Don’t trust blindly – One should not rely on word of mouth for purchasing a property. A thorough research should be done before making any commitment. A third party can’t be trusted blindly. The company with whom you plan to invest should be credible and have goodwill in the market. Striking a good deal with a known name is always better than investing with someone who is completely unknown in the market.
4. Make a plan beforehand – One needs to plan as to which area would give them more returns and how much investment they can make at present for their future. There are many deals which might look attractive at first. A proper analysis before making the correct decision is very important.
5. Not enough knowledge of the local market – One may not have a prior knowledge about the real estate market. It’s important to do a survey of the present market conditions and how lucrative the investment might be in future. One should know about the land value, property value and the places which are growing in the current market. These would ease out the decision to buy a property which is well within the budget and also worth buying. Only buying a property is not the final thing. One should have enough capital reserve for maintaining it as well.
6. Buying in the wrong area: Since there are a plethora of attractive investment options, it’s quite easy to get confused. A property should not drain away your money. A well-developed or developing area will fetch good returns in future. The land should have easy connectivity, accessibility to necessary things and services, and should be a good locality with good infrastructure. All these things should be kept in mind while making the decision.
7. Having high expectations: We all want a rewarding appreciation from the piece of land which we have invested on. But our expectations should not be sky high. We all should aim towards having a realistic profit in the future from the property we have invested in.
8. Choosing the wrong real estate agent: A true real estate agent will always guide correctly so that an investor can make the most out of the deal. He will also refrain you from making any mistakes which you might repent later. So, it’s important that the agent has a good track record in the market and is reliable. A good agent will always make sure that you get a great appreciation with the money you have invested in. So it’s always better to check the credibility of the real estate agent before getting into the deal.
Whenever you make the decision to purchase, just keep a check of all the above mentioned points so that a safe investment can be made.