In India land is a limited resource and therefore, most people believe that it is one of the best investment options. Real estate prices are continually increasing and owing to this, investors believe that in 10 years they can earn a much higher return on investment from this method when compared to any other method. However, investing in real estate is not easy, as it requires a huge sum, whereas other investment options do not require such a huge amount.
Here are some factors to consider before investing in land
Land availability
In India, currently, there is very less land available for real estate purposes, since land is not managed properly. In a few years this situation might not be so dire due to government regulations. However, currently purchasing land in major cities is not easy, especially for residential reasons.
Liquidity and return on investment
Land is not something which is always easy to liquidate, since the demand does not stay equal at all times. Therefore, liquidating might not be so easy. Furthermore, after purchasing a piece of land, it is fairly difficult to sell it immediately and earn a profit. In fact, in most cases, if one wishes to sell land immediately after purchasing it, they might not even breakeven. In order to get a high ROI, it is necessary to hold a land for at least 5 to 10 years and then sell it.
Maintenance
For those purchasing flats, it is necessary to pay maintenance charges, in order tokeep the flat in a proper condition so that its value does not depreciate with time.
If you have the income to purchase or invest in a real estate property, you need to carefully understand all its ins and outsin order to earn a significant profit, so contact Arthavidhi to start planning.
