Friday, January 29, 2021

Things to Avoid while Investing in Real Estate

If you were to believe the latest national news, consumer confidence is on the decline and cash deficit on builders on an incline. In Mumbai, Delhi-NCR, and other popular cities, the demand has come down to around 50% for new property launches.

But not everything in real estate is gloomy, the Reserve Bank of India has recently made a cut in policy interest rates. While this news may cause haste in investing in the sector, say in buying luxury villas in Bangalore or any other metro cities, there are some things you need to consider before making an investment. These are mentioned below for your consideration:


  • Trading in real estate properties frequently


When you trade in real estate properties more frequently – that is, buy or sell your property in shorter duration – you may incur a loss in tax benefits.

To be precise, if you sell your property within 3 years of making your real estate acquisition, such acquisition would then be called short term capital gain, which entitles you to zero tax concession or exemption.

But, if you sell your real estate property after 3 years, it entitles you to long term capital gains and the taxation for this would be at a comparatively lower rate.

Be wary that if you trade-in too many times even in long term capital gains as it could alarm your Income Tax officer, who may consider this dealing as your business income and withdraw the low rate on long term gains.


  • Investing in properties that are due completion


It’s easy for your agent or builder to make excuses for not completing their project on time and completing it at a much later date than promised. They may not have any hidden agenda behind this, except prolonging time. It means a little more number of EMIs for you than which were originally expected.

The second of the two-pronged effect of the delay is this: The tax benefits that you receive on your property investment are restrained on possession, which is a direct effect of long delays.

Being alert on investing in incomplete or overdue properties is therefore very important, at least for your pockets.



  • Planning your budget before investing


We know that if a budget is unplanned or unsupervised before investing in real estate, it may deplete most of your saved resources, back-up money, or hamper your short-term investments. It may also affect your daily expenditure and can create dearth in your cherished small purchases every now and then.

Purchasing properties not just involves a down payment but also what seems like an endless array of EMIs – directly affecting your monthly salary.

Seek the professional advice of your financial consultant before buying a real estate property. A good recommendation would be saving at least 40% of your total income after you have made your investment.


  • Considering all the factors before making your investment


As again like planning your budget, it is equally important in knowing and fully understanding all factors involved with making your investment, because knowing the loan criteria, real estate details, and repaying capacity are not adequate. Consult a financial adviser for a complete financial plan on your investment.


  • Plenty of investment in properties may not result in profits always


The best idea would be to divide your finances into different types of investments, and not just stick to investing in real estate. First, because transaction costs in real estate are much higher than say investing in gold, bank deposits, bond funds, equities, etc.

The prime reason that people choose to invest in a lump sum in properties is that their prices increase at a faster rate compared to other most forms of investments. While this may not be true always, it’s wise to be aware of the current changes or trends in the market for accurate predictions.

If you are planning to make any investment such as buying villas in Bangalore or Chennai, etc., these above-mentioned points should hopefully help you in making the right investment.


This is a guest post by Dinesh Dhawde

53 comments:

  1. This comment has been removed by the author.

    ReplyDelete
  2. Yeah it's a great & knowledgable blog which is shared over here. There are many real estate companies in jaipur, Rajasthan. Suvaas is one of the best among them. For more details you can visit here at Affordable Flats in Jaipur

    ReplyDelete
  3. Amazing blog. As we know demand for real estate is growing in an alarming rate, it’s very important that people should aware about the major drawbacks of investing in real estate. Anyone looking for Villas in Whitefield, before buying just go through above blog and avoid things that are mentioned in it.

    ReplyDelete
  4. Thanks for sharing awesome information about real estate projects.Shapoorji Pallonji Joyville Whitefield

    ReplyDelete
  5. Great & knowledgable content has shared by you. That's awesome! Suvaas is a leading real estate company in Jaipur, rajasthan. You can know more about it here at 2 BHK & 3 BHK Flats in Mansarovar

    ReplyDelete
  6. Detailed article. I liked it. I recently purchased one of the new flats for sale in Chrompet as it is in a developing location and looking at serious infrastructural development in the future.

    ReplyDelete
  7. Great & Knowledgable article has shared by you. A real estate enthusiast should go through with this blog. Shree Ram Group is a leading real estate company in Jaipur, Rajasthan. You can know more about it here at Affordable 1 BHK & 2 BHK Homes in Jaipur

    ReplyDelete
  8. Hey, nice article mate..!!

    But I do have a suggestion. Plenty of apartments in Chennai do result in property. That is these apartments are good source of income for the people of Chennai in the form of rentals. People get a great deal of returns in this idea and would love to invest in real estate of Chennai.

    ReplyDelete
  9. Good info Dude

    Am thinking of investing in real estate lately and especially on luxury villas in Chennai. This provided good insight on making my first investment.
    Thanks.

    ReplyDelete
  10. Great info
    I was so confused about investing on villas in Kelambakkam, this article helped me get an idea though. Thank you.

    ReplyDelete
  11. Great information. Anyone looking for apartments for sale in HSR layout, before buying just go through above blog and avoid things that are mentioned in it.

    ReplyDelete
  12. Thanks for sharing awesome information about real estate projects.... Thanks for sharing that..
    Real Estate Developers in Lucknow, Plots in Lucknow

    ReplyDelete
  13. Thank you dinesh for this blog am also looking property in pune, & i find highmont hinjewadi project is the best for invest my money http://www.highmont.in/

    ReplyDelete
  14. Very impressive blog. Thanks for this wonderful post. Find properties for sale hyderabad

    ReplyDelete
  15. Nice!
    This is a informative blog which i want from so many days. I like your blog and the way of representation of content.

    California real estate investment clubs

    ReplyDelete
  16. Interested information sharing through your blog. Keep updating.
    Reputed Builders in Chennai

    ReplyDelete
  17. Nice Blog Post… If someone wants to take a flat or apartment in your budget of 1bhk, 2bhk and 3bhk, then Godrej Hillside is giving you a good real estate property.

    ReplyDelete
  18. This comment has been removed by the author.

    ReplyDelete
  19. Great Article!! Very informative.
    Also check out For properties in Bangalore.Land in Bangalore.
    Land India

    ReplyDelete
  20. Great Post. Surely! It will help the investor to investigate and plan before taking any investment plan in real estate property during and after the corona situation. Shapoorji Pallonji Real Estate offers residential property across India for both the Upper and Middle lower classes.

    ReplyDelete
  21. In this blog has a nice collection and good articles. I was like this post.

    ReplyDelete
  22. Introducing ATS Home Show, a new luxurious home property by the leading realty developer ATS Infrastructure Ltd.

    ReplyDelete
  23. Thanks for the wonderful blog article on the things to avoid in real estate investment. Many builders offer new apartments for sale in Porur, but proper investment plan should be done.

    ReplyDelete
  24. This is really a nice article which provides a new perspective about the industry. Ferrocement is a composite material comprising rich cement which is highly reinforced with continuous and small diameter steel rods and wires.

    ReplyDelete
  25. If you want to buy the city of your dreams then Mahavir Spring Thane it will be the best house for you.

    ReplyDelete
  26. You will be provided with modern call center cubicles that come with a stylish design. To know more contact us today
    Office workstations
    Quad Cubicles
    Buy Office Cubicles

    ReplyDelete
  27. You have shared exclusive information about real estate. Get your dram home inside the Godrej Nirvaan .

    ReplyDelete

  28. Thanks For Sharing !!
    Are you looking for hiring a real estate realtor in Canada? Meet Jaideep Puri, who assists you in finding the best suitable location. According to your requirements, he will help you to obtain a reliable and relevant place.

    ReplyDelete
  29. This post is great. Thank you for this post. I like this type of people who share knowledge with others.
    Eamon Lowe Gold Coast

    ReplyDelete
  30. KPMG Lease Management Tool (KPMG LMS) assists businesses in complying with IFRS 16. KPMG LMS supports the management of multiple lease contract, and it\'s compliance and accounting. The service features a combination of purpose-built software and a behind-the-scenes data analysis team to help manage your lease accounting efficiently.

    ReplyDelete
  31. Realty Speaks, India’s No. 1 Online Property portal, deals with every aspect of the user's needs in the real estate industry. It is an online Property forum to Buy, and Sell residential & commercial properties. Realtyspeaks.in is the wildest rising company in the online real estate Marketplace. Visit Us at: https://www.realtyspeaks.in/

    ReplyDelete
  32. KPMG Lease Management Tool (KPMG LMS) assists businesses in complying with IFRS 16. KPMG supports the management of multiple lease contract. The service features a combination of purpose-built software and a behind-the-scenes data analysis team to help manage your lease accounting efficiently.

    ReplyDelete
  33. Thanks for sharing the best information and suggestions, I love your content, and they are very nice and very useful to us. If you are looking for the best investment property, then visit Themortgageagency. I appreciate the work you have put into this.

    ReplyDelete
  34. This comment has been removed by the author.

    ReplyDelete
  35. If you are looking for the cheap land in California then let us help you to choose the suitable property for your needs. Get started with us today!

    ReplyDelete
  36. Thanks for this informative suggestion.
    When it comes to finding Housesfor RentinRiverside Jacksonville FL, Homes for Sale in Ortega Jacksonville FL, New Apartments and Multi Family Homes in Jacksonville FL, Traditions Realty LLC is Jacksonville Real Estate Experts that can help find the perfect home and property to suit the needs of you and your family.
    For More Detail Contact Us:-

    Address:- 1046 Riverside Avenue,Jacksonville, Florida 32204 United States
    Email:- info@traditionsjax.com
    Phone:- 904.683.5230
    Website:- http://traditionsjax.com/

    ReplyDelete
  37. Thanks for your information !!!

    If you would like to buy property in India then go with trusted property portal. I.e; RealEstateIndia.Com

    ReplyDelete
  38. Techsaga Corporations is responsive mobile apps and websites that help real estate professionals to generate leads and enhance ROI. IT company for real estate industry are developed to enable real estate and construction companies to capitalize on the power of cloud computing, mobile technology, the Internet of Things, and wearable technology.

    ReplyDelete
  39. I enjoy what you guys are up too. This kind of clever work and reporting! Keep up the wonderful works guys I've incorporated you guys to my own blogroll. California Lender

    ReplyDelete
  40. There are a couple of concepts that you need to call an instructor and also among them is exactly how to prepare reliable and also interesting lessons for your trainees. Finding out the elements that make a great airspace weather minimums is crucial as it will certainly urge your pupils of various characters as well as allow them to get one of the most that they can out of your lesson.

    ReplyDelete
  41. McLaren Specter is amongst the best Estate Agents in London and able to access properties and clients across all 7 continents with McLaren Specter International Real Estate’s global team across all 7 continents.

    ReplyDelete
  42. You might be familiar with Notting Hill because of the movie, but it has other claims to fame too. Besides being a tourist attraction, the neighbourhood has some prime Central London properties on sale. Victorian houses are lining the streets, ready for your families to make them a home.

    ReplyDelete