Monday, May 15, 2017


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Dealing with the real estate finance and property matters is an uphill battle. You never know which move will make or break your future plans. Especially for the first-time dealers or the new beginners, the real estate dealings are a learning road. The investors step into this new world of investments and weigh the pros and cons of various property deals against each other. Once they are fully satisfied and have talked to their agents and lawyers, it is only then that they get into a contract with the seller. Even then, the beginners and even professionals tend to make unforeseen mistakes at the time. But, through thorough research and learning, they can do their best to avoid the common pitfalls that can be disastrous.

Here are the common mistakes that can be avoided easily if one has some background of financial and real estate guidance. The mistakes are as follows:

  • Lack of research

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Most of the investors while dealing with property do not know everything that they should. The real estate agents take advantage of this fact and there’s a high chance that they’ll allure you into making less beneficial deals. This is where your knowledge and a good support system are required.
The lack of research can be in choosing the right location or in financing (discussed ahead). Many new investors ask very few questions regarding the property they are shown. This is a big mistake! You should ask everything about the place. How investing there is beneficial? What facilities does it offer and a lot of other things? Say if you are interested in investing in the property located on the Al Marjan Islands UAE, wouldn’t you ask about the other UAE islands and the other potential areas? You must approach every possibility that you can.

  • Not having a strong financial approach

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The property investors, home buyers, building renters, everyone must have a strong financial background. The dozens of mortgages offer, loan plans and financial funds are available in the market with the purpose of helping the investors purchase what they want. Here, sticking with the budget you have is very important. Some of the investors are attracted to homes and buildings with a higher price. As a lot of other expenses should be taken into account before expanding the budget, spending money on such a deal is a waste of your money and time. Other bad investments include those with a high-interest rate, high monthly payments, and balloon payments.

  • Giving up easily on negotiations

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Good communication and negotiation skills are a trump card in the real estate dealings. You need to have a strategic approach if you want to get a good deal and negotiations play a very important role here. To excel in this domain you need to learn the basic techniques and tricks of property dealings. What many investors here do is they give in easily to what the agent has said. Even if they aren’t satisfied with the deal, they fail to negotiate with the agent. Then the end results, in this case, aren’t good enough. This is why you need to learn how to negotiate or at least know the basics of the essential things and how to talk about them before signing the contract.

  • Miscalculating the repair costs

It’s not only the property land or the building that costs you your life savings but also the repair cost that most of us ignore to consider. The repair cost is the money one has to spend, after buying the property, on the maintenance of the building. Everything from the repair of the lost connections to painting, lawn care, the furnishing of the place and few other important tasks are included in the post-property buying expenses. A buyer must consider these and make sure he doesn’t go out of cash so that he could fix these issues as well.

  • Ignoring the due diligence period

A due diligence period is the right of every buyer and those agents who don’t give it or keep it short must be stopped. As the buyer, you are responsible for the deal you are making and you must keep a reasonable due diligence period before finalizing the deal so that you have a chance to end the deal if you find some problem in it. During the due diligence period, you should hire a third-party proper property inspector who looks into every aspect of the house and analysis it. Estimate the repair cost and check whether there is any other issue or not.

Real estate investment is tricky but not impossible. If you follow the proper guide and avoid the common pitfalls we have mentioned in the article, there’s a higher chance that you’ll succeed in making your very first potential deal. Keep your head high and be attentive during the whole process. This is what it takes to get a good deal.

This is a guest post by Rachel Stinson who has always had a knack for writing, food, fashion, and places. Blogging has combined all four for her with an added bonus of enthusiastic audiences. She expertly analyzes real estates and restaurants with respect to pricing and people involved and can express her opinions in an unhesitating, engaging manner. 

Monday, May 1, 2017

Why Home Loan Interest Is Too High for Indian Buyers?

A recent survey carried out by the Indian Mortgage Guarantee Corporation IMGC-Kantar IMRB showed that high housing loan interests and lack of savings are factors that discourage Indians to own a house. According to the survey, borrowing money is another constraint for people that prevents them from investing in a new property. The survey also revealed that the younger generation (25-44 years) is keen on buying affordable houses in smaller towns than metropolitan or mini-metros.

Conducted in two phases, this survey had a sample size of about 4,100 respondents from towns, mini metros, and metros. These respondents were people who had opted for a home loan. The age group was segregated into 25-34, 35-44, and 45-55.

At the launch of the report the MD & CEO of National Housing Bank, Sriram Kalyanraman said, "Housing sector is poised for higher growth, especially in affordable housing segment by the Housing-for-all by 2022 Mission and infrastructure status accorded by government, apart from various other measures,"

As high as 38% participants of the survey had the same opinion that the home loan interests are too high. An equal number of people gave the reason that their savings aren't enough to meet the expenses of buying a new home. Other factors listed in the report were higher property rates and insufficient loan availability.

The report also pointed out that home ownership delays are being caused due to high dependence on personal savings to pay for down payment.

When questioned about the progress on Housing-for-all, Mr. Sriram Kalyanraman addressed by saying that apart from the government lending and loan subsidies, many other private developers launched projects under affordable housing. He added, "The full data has to come from private sector. Once we take it, I think we will surely be in line with Housing-for-all by 2022." Furthermore, he shared that presently small-sized houses of about 500 square feet are in great demand.

It is also believed that demonetization has led to a fall in the property prices. This fall is indicative that it is the right time to invest in properties in various cities. Buying apartments in Bannerghatta Roads, Bangalore, or residential properties in OMR, Chennai, or apartments in Hyderabad will become easier for the public.

Mr. Sriram Kalyanraman also believes that prices are sure to come down and demonetization has helped a lot of clients. In addition, there is far more transparency in the buying and selling of houses in the INR 15-20 lakh segment.

The report also stated that many Indians still live with their parents, than in a rented place or self-owned house, which shows their financial dependence. Amitava Mehra, the CEO of IMGC said, "There is a gap in the market. These can be managed to a large extent by mortgage guarantee backed loans. With availability of higher loan to value (LTV), Indian home buyers can achieve their home buying dream by not relying solely on personal savings."

This is a guest post by Dinesh Dawde.