Factors to Be Considered Before Investing in Property

Buying a property is a crucial decision as it demands a huge investment. The amount which goes into a property is sort of a lifetime investment. It is not just an asset, but also provides a sense of security, which is very important for any family. This article would be quite useful for the first time investors. Even an expert can miss a few points before buying, so it will help them too to ensure all things are taken care of. The major factors to be taken care of before investing in a property are as follows:

Your budget:

Be well aware of your expenses before planning to buy a property. Can you pay ready cash or would you opt for a loan? If you are going for a loan, how much down payment will you make and how much amount are you ready to pay on a monthly basis has to be decided upon. Also ensure that the property that you are investing in fulfils your family’s needs. If the requirements of the family are kept in mind it would be easier to be clear on what has to be done and what not has to be done.

Select appropriate location:

Selection of appropriate location is the basic requirement while selecting a property. It is a simple rule that the locality which is already in its prime would not lead to higher returns in the long run. It would be judicious to select a location near the prime location or which is developing at a fast pace that would lead to better returns.

Facilities in neighbourhood:

It is very essential to check if the location has the proper amenities before finalizing the property. Look around if there are schools, hospitals, banks, shopping centres, restaurants, entertainment facilities and parks in the locality. Not just focus on location and price, but also do check if these amenities are available.

Authenticity of builders:

The buyer should do thorough research on the trustworthiness of the builder before jumping into the deal. The buyer should also interact with the builder and ask lots of questions to clear the doubts. You will be surely satisfied in the end if you have done proper research before investing in the property as there would be very less scope for fraud and misunderstanding. It is also important to get a drawing of the project stamped by the municipal authorities as it will be a proof against whatever is being promised by the builder.

Electricity, water and sewage system in the area

If you have decided on buying property in a particular area, then it is essential to ensure that water and electricity supply are proper. Waste disposal is in deplorable condition in many of the localities, hence ensure there is a proper waste management system. Check if the sewage system affects the water supply to ensure the quality of the drinking water. In a nutshell, if these facilities would be checked properly then you would not have to regret later for your decision.

Investment for rental purpose:

If one is looking a property to invest in, which is for the purpose of renting, then it is important to not just to look into the locality, but also to get an idea about the rental income that could be earned. Homes that are available in highly populated areas are a good target for rental purpose as it would prove to be a great source of income.

Resale value of property:

Most of the property buyers tend to be emotional while buying a new house. The major thing to be taken care of when you are investing is to research about the locality, the property, the builder and the growth prospect of the area. This would ensure that only the beauty of the home or the interior is not looked upon, but also the other factors which would not lead to a blunder in the selection of the property. One should ensure that the locality is not ill famed for theft or other crimes and the basic amenities are available there.

Eligibility for loan:

If you are planning to opt for a loan, then it is necessary to know how much are you eligible for?  Different banks have a different criteria list as per age and income. Previous loans and other liabilities are also taken into concern. There are software like home loan calculators which allow to calculate loan eligibility.

Legal procedures such as registration and stamp duty:

Like a sales tax or income tax, registration and stamp duty is also a tax collected by the government. It is necessary to know the rate and charges applicable in the city one is opting for while planning to buy a property. Find out the rates as per market value prior to finalizing the deal so that there is no scope for being deceived.

Extra charges:

Even if you are not buying a property for the first time, it is essential to take help from a team of experts. The team, which would charge various fees include real estate agents, lenders or mortgage brokers, land surveyor, lawyer etc. Extra charges would also include maintenance charges. Parking charges are also a part of other charges, which varies from builder to builder.

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