If you've ever wondered how to begin investing in property, there are a few points you can keep in mind. Here are a few pointers:
It is always a better option to invest with a developer who has a proven track record, even if you have to pay a premium for the Asset. This premium will pay itself back with timely delivery and a high quality construction. Not to forget the lack of sleepless nights!
Now that Real Estate Regulatory Act (RERA) is enforced in most States, study the disclosures to understand the costs of construction, timelines, existing sales in the building and other nuances of the Asset. The information will be able to tell you facts and also may throw up some questions which you can clarify before making the Investment.
Do not trust brokers or intermediaries who are not registered with the Project: Under the RERA guidelines all brokers need to be registered with the project in order to market the project. Brokers are also liable for the information they share with prospective clients, misleading clients have stringent penalties on brokers too.
If you have made a decision to buy a house, integrate all your finances to check as to how much down payment you can make. The higher the down payment, the less your EMI will be and the eventual cost of the home as you will pay a lower cumulative interest on the asset.
Check your credit score before you apply, so you do not receive any unpleasant surprises when you apply for the loan. The RBI has instructed that a person should get at least one base-level credit report free in a year. Ensure that all the dues are paid, in fact try and keep your expenses low for 10-12 months before the application of the loan.
New buildings with a lot of amenities have high Common Area Maintenance (CAM) bills per month. Please ensure you have accounted these costs along with the cost of paying your EMI once you have taken possession.
If a developer is selling an asset at a deep discount to others in the micro market or is offering some creative financing options (low down payment, rest on possession type deals), please spend extra time in doing diligence on the Asset. Many projects today are under water and these schemes help the developer float for a little longer, not necessarily get out of water.
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