Mumbai is the City of Dreams. People from all over India come here in search of employment, better opportunities and a better life. With such a massive inflow of people, the city has continued to expand Northward and Eastward. The cities growing infrastructure has allowed the working population to live further and further away from the city centre while still being able to reach work on time.
Along with the city’s infrastructure improvements, real estate in Mumbai is undergoing massive changes in favour of the buyers. Two new frameworks – Real Estate Regulatory Act (RERA) and Goods and Services Tax (GST) have been established. The real estate projects need to comply with RERA, which makes sure the project is completed on time and money invested by buyers is not laundered for other projects. The framework is aimed at providing transparency and increasing Foreign Direct Investments.
By far there are two reasons to buy real estate:
- As a secure and comfortable place to live.
- For investment purposes.
For both purposes, the considerations and criteria change accordingly. When it comes to investing in a property we immediately think about the cash flow, taxation and appreciation of the property after a few years. But, when it comes to buying our own property or home the only point we focus on is the comfort of our family.
If you are scouting for your own house you would basically look for –
- Close proximity to work.
- The locality of the real estate – convenience for traveling, prime locations in Mumbai etc.
- Religious factors – closeness to temples, churches etc.
- Accessibility to schools, colleges, hospitals, grocery stores etc.
- Ability to decorate the home as per your choice and personality.
When looking for a property for investment purposes you would basically look for –
- Cash flow from rent (return for any given year after 5 – 10 years).
- Ability to get a mortgage.
- Tax benefits.
- Appreciation of the property.
- A hedge against inflation.
- Outlet to earn extra money.
Real estate investing is long-term and generally has more stable growth. Real estate properties have tended to appreciate over time and are not for people who want to invest for a short period. There can be factors that could affect your decisions like locality, rent, building or society management. One important tip is to always check the property by yourself and do thorough research on the builder.
Be careful before investing. Real estate has its own pros and cons, like any other investment. You might end up losing more than you think. It is better to do proper research on the builder, property, locality etc. before making any decision.