Why you should invest in Real Estate?


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Why you should invest in Real Estate?

Here are the reasons for you to get into real estate in the first place:

  1. Security. When you buy real estate, you have something tangible for your money. When you buy a stock or bond, you have nothing but paper. But It is always good to physically see your property and sleep well knowing you have something in your name that is of value.
  2. Safety from all inflation scenarios. You can’t at least occasionally worry about hyperinflation. In this scenario, inflation goes up to insanely high levels. In this eventuality, rents also go up exponentially and real estate holds its value. In fact, real estate has a track-record of thriving in standard India inflation, ranking top of the list of investments for holding value, along with gold.
  3. The ability to obtain sensible leverage. You can’t get a bank loan on most assets. They just won’t take it as collateral or offer attractive terms. But real estate is the main building block of bank lending, and it is relatively easy to get 70% to 80% leverage on decent properties, with 30 year amortization and low interest rates. This means that you can buy a property that costs five times more than your cash will allow. And it also leads to higher returns.
  4. High rates of return. Good real estate sectors can hit return levels that are several times higher than ordinary investments. These high rates of return are extremely compelling and offer attractive risk-adjusted returns that are unparalleled.
  5. A huge number of options. Most people don’t realize that the “real estate industry” is really just a generic name for the many sectors that are out there. There’s single-family, apartments, office, retail, assisted living – about 40 different niches in all. You can choose from these options the perfect niche for your interests and goals, as well as beliefs in the future of India.

Disclaimer: The article contains data collected from various sources & the use of same is at readers discretion.