Tag Archives: investment consultant

Top 5 neighborhoods to invest

In the last decade Gurgaon has emerged as a profitable location in the vicinity of the national capital as an investment opportunity. With multinationals taking up much of office and retail space, the employees are also making a beeline to take up places on affordable rent if not to buy. We at MyFollo.com, bring to you some of the hottest neighbourhoods in Gurgaon and Delhi where one should think of investing.

Sohna Road: Just a few years ago, Sohna Road was a sleepy neighbourhood, but off late, it is fast becoming a prime residential property. Besides being connected with the NH8, it is in the vicinity of many townships that are emerging like Bhiwadi and Manesar. Sohna Road has some excellent residential apartments, villas, plots besides malls and hospitals which are already operational.

Golf Course Extension: This area is another location which investors are making a beeline for. Golf Course Extension is just 30 minutes away from the international airport and well connected with the NH8, south Delhi, Gurgaon-Faridabad road and Sohna Road. If you are looking to mingle with the elite then a property here should be your destination. Well equipped with civic amenities, this place is a buyers dream.

MG Road: With the plush malls and residences, MG Road is an evergreen location to invest. Though deemed expensive, MG Road has fetched high returns on commercial properties historically. If you have an appetite for high returns, then one must consider MG Road.

DLF Phase 1: One has seen a tremendous growth in the infrastructural developments in Gurgaon DLF City and DLF Phase 1 has emerged as spaces with high growth prospects. It is wise to invest in under construction properties from a purely investment purposes and divest it at a peak.

South Delhi: There is a certain charm of living in south Delhi in a posh locality. Always considered as prime locations the trio of Greater Kailash, Vasant Kunj and Vasant Vihar have options of bungalows, apartments and commercial properties. The high rate of returns clubbed with the benefits of being in the toniest parts of the first city, New Delhi, these are few locations which will not be affected by market fluctuations.

“MyFollo” is an online real estate ecosystem bringing in change in the way online advisory and transactions are executed. Write to us at contact@myfollo.com  to know how we can help you.

What does a good Real Estate Investment Mix looks like

One invests keeping in mind the longevity of the investment and how much risk one can take. Basis our understanding, we realise that when we invest keeping in mind say retirement, then the asset allocation will be much different from when one is 30 to when one is 50. In real estate investments, one can choose aggressive investments that have a potential for high growth but then there is higher risk attached to it. With retirement the time for money to grow reduces and one has a constant need to withdraw. So sometimes conservative investments, that are less risky and low returns also seem profitable.

Another factor to keep in mind while choosing an ideal mix of investment is:

  • How soon will one want to divest
  • How comfortable will one be investing a large chunk of income on investments

Keeping these in mind, one can choose to invest in one or all the options available

  • Residential properties: Timing is a key factor to a good return on investment. If one is looking to earn regular income then there is no risk of when to exit. However if capital gains is the sole aim, then timing is a critical factor. While it is advisable to hold a property for at least three years but statistics show that good returns come only between five and seven years. For capital gains it is a good move to acquire under construction properties. The only factor going against investing in residential properties is to know the key times to invest and sell. One may end up buying at a price high hoping the prices will go higher but in reality the prices go down and one may end up making a loss, if exiting to soon. 
  • Commercial properties: Investing in commercial spaces helps one diversify the real estate portfolio while earning regular rental income. For the business savvy investor, commercial spaces both office and retail spaces are a good bet. Unlike stock market fluctuations, real estate investments are far stable and also the rental income is approximately 10% of the property value in a year, quite high than what one would earn from a residential property. Also a factor to keep in mind is that higher returns would mean higher investments unlike investing in a house.
  • Mixed use properties: These properties are seen as the golden opportunities by both the real estate sector as well as investors. While real estate developers have diversified their risks by bringing an element of commercial as well as residential into their projects, investors and buyers have also felt comfortable to gain on the benefits offered. Certainly successful concepts around the globe, mixed use properties offer home buyers to be near their work place and much requires social infrastructure. Just the thought and dream of many to stay in the vicinity of a shopping mall and other luxurious amenities is a win-win situation. Developers are bringing in residences, a shopping mall, a hotel and offices together in many metros.

“MyFollo” is an online real estate ecosystem ringing in change in the way online advisory and transactions are executed. Write to us at contact@myfollo.com   to know how we can help you.

Real Estate Market Trends vs. Forecasts – What to go by?

In the last few years, the real estate market trends in India, have not been encouraging. The markets, especially in the residential properties segments, recorded a slowdown. The prices have remained stable with multiple options available for the buyers, though the commercial real estate has been optimistic. Also the capital appreciation in the short term has not been significantly high.

Given the background, the real estate industry is also regrouping themselves with major players working on delivering projects and building their portfolio to gain trust. Also with the new government policies like Make In India, FDI and 2020 vision, things are looking optimistic for the real estate market. The recent Start-up India will also give an impetus to the real estate market. Based on studies and experience the forecasts for the Indian Real Estate Market looks very promising. The top 3 highlights are:

Tier II cities: The meteoric rise of the Indian real estate market, specially in metros like Delhi, Bangalore, Mumbai and Hyderabad can be attributed to the technology and start-up hubs. It is now the time for the Tier II cities like Indore, Lucknow and Chandigarh to taste success. Local and national level developers are now focussing on the Tier II cities like Pune because of aspirations, successful business start-ups and steady growth in employment opportunities.

Simple payment structures: The developers and banks are working towards easing the pressures of the payment plans. This would lead to more participation from buyers to invest with small monies and pay off gradually with easy payment plans.

Smart Cities: The government showing active interest in building 100 smart cities and increasing the FDI participation in the reality will give a positive boost to the real estate market. Hopefully with participation from local investors as well as NRI’s there would be a growth in these smart cities as well.

For the prudent investor it is advised to move from the wait and watch strategy to slowly start expanding portfolios to newer markets, especially the tier II cities and prime pilgrimage locations. One needs to move out of the comfort zone of familiar localities and start Identifying and investing in feasible properties for better returns.

5 Property management tips for 2016

Top 5 Property Investment Management Tips for 2016

There’s an age old saying “spend money to make money” and in our decade old experience, we can swear by it. While it is important to spend funds wisely, but to invest efficiently and avoid costly mistakes down the road, we bring to you Top 5 Property Investment Management Tips for 2016

Know the market dynamics, where you are investing

One of the most important decisions that you will ever make is that of investing in real estate, solely because of the capital growth that an investment of this nature offers. Besides the price at which you are acquiring a property, it is critical to also understand other dynamics that come into play like the area. It is wise to do as much research as possible, for example speak to locals, shopkeepers and know how the area is, what are the developmental plans, which part of the area is better than the other? A good trick to get inside information is to speak to competing agents about similar properties in the same location. While these are good methods, it is also advisable to seek professional services in these matter and also do independent research about property values, rents etc. which are easily available across so many portals now.

Understand the condition of the property and the facilities available

When making a decision to acquire a property, it is advisable to do a thorough check of the prospect property and look for defects like damaged wall, woodwork, cabling and leaking pipes etc. Identifying these will make a significant impact to the profits or put a dent in the cash flow.

It is also not prudent to buy a property which is in a perfect condition, because that would mean higher cash outflow. While you can get a higher value from a property in not so good condition by sprucing it up a bit, which will increase the capital growth as well as command a higher rental.

Make the property attractive

We all like good things around us. So if you are planning to put your investment property on rent,  and then the suggestion would be to keep the property in good condition. One thing that attracts good tenants is well kept properties. It is advisable to remember that when the time arises to sell, then the decisions are also usually made basis if the property was owner occupied vs tenant occupied, because buying property is an emotional purchase than a logical one.

Manage risks from a long term perspective

Unlike traditional methods of investing like shares, gold etc., investment in property is usually a long term investment. One should not invest for the sake of instant profits. The longer one can hold on to a property, the better it is. The idea is to strike a balance between financial stability and enjoying a good life and not become stagnant.

A key thing to remember is that you cannot sell your investment property instantaneously if the need arises. The market works on the dynamics of supply and demand and it may take months to sell a property, so you should be mentally and financially prepared.

Hire a professional Property Investment Management firm

Times have changed. We have come a long way from relying on the services of a local property dealer to hiring professional services. A managed services firm comes with unmatched years of experience working with different markets and types of properties. They are the ears and eyes of the market and help making logical decisions based on market reports, analytics and get the best value for your property. A property management firm can also take care of maintenance issues, finding the right tenant with checks, besides having expertise about legal issues in case a need arises.

“MyFollo” is an online real estate ecosystem bringing in change in the way online advisory and transactions are executed. Write to us at contact@myfollo.com  to know how we can help you.

Property as a Wealth Management Tool

Given the uncertain times that we are in, one should always work towards being financially independent and be able to create wealth. In most of the investment opportunities one can start investing with small amountsand monitor the gains/loss on daily basis like that of shares, gold, FD’s etc. However one of the investment opportunities which are often overlooked is that of property. The main reason is that most people feel that oneneed to have access to good amount of money to start with but can’t put a value to the gains/loss instantly. However, this is not the case always.

Property investment is considered as long term investment option. So the wealth creation is generally fruitful when approached with the perspective that wealth accumulates steadily over time rather than by investing for a short term like in cases of shares. Property investment is a tangible investment. An investment in property has a physical presence that one can see, touch and control. The good part about property investment is that one can earn from its rent uniformly,even during the rise and fall of property market.  So, it is important to acquire the right asset at the right time,at the right location.

So, how does one identify the right asset, right location and the right time? Unlike buying shares where the value of a company is evident, real estate is more difficult in terms of pricing. There are chances that one ends up paying extra based on perception, or as it has been observed that if one is patient and is armed with the right knowledge, an investment in property also gives the opportunity to acquire an asset below its real market value. So, the key to success is research and right advice from professionals. The basic hygiene to keep in mind while investing in a property is to begin familiarizing with the locality, price range in that area etc. Once an idea about pricing of property in the identified locationis established, only then one can bargain to analyse the real worth of property. However while you may be in a Delhi, you may want to invest in an upcoming property in Bangalore, Hyderabad or elsewhere which is not in your area of influence. In times like this established professionals like MyFollo (hyperlink), can provide the real insight about which property to invest based on market intelligence, background of developers, location and legal aspects besides other factors. Also they are able to help choose a property keeping in mind the capital growth aspect. i.e. a property in certain area will have less growth rate as compared to other due to various reasons. One should keep the following in mind, while considering the property and its potential growth:

  • Infrastructure/amenities in the locality
  • Plan and timeline for the new infrastructure
  • The price trends in last few months
  • Potential rental income
  • Social security
  • Brand name associated or the goodwill of area
  • Loan facility on the asset
  • Age and condition of property and facilities

 

For calculating the total cost of the property one would have to consider other costslike increase in IDC (infrastructure development cost), registration cost, loan free, additional fees like maintenance,  parking and club fees etc. One should start investing in those projects which will give the possession in coming 2-5 years. In this way one wouldn’t have to give all the money upfront and also have sufficient time to plan of payment for the rest of the money. Also 2-5 years is a good time to invest the money in a property because in that period the value of the property will usually command a better price, because of infrastructure growth, better facilities, market places etc.

One thing to keep in mind, is that thebuying and selling cycle needs some time for the ‘property handover’. This leaves property investment option as mid-term to long term investment option.

Finally, one needs to be aware about the scope of liquidity in property investment. One just can’t sell property as easily as gold. However, rental income is also a good option which can help in taking care of EMIs or can be seen as a regular source of income. In short, one can earn regular money by using property as a wealth management tool, in form of rent but if the wish is to liquidate the investment, then consider it as long term investment option.

MyFollo” is an online real estate ecosystem bringing in change in the way online advisory and transactions are executed. Write to us at contact@myfollo.com  to know how we can help you.