Yes, you have read that right. All that I am suggesting is not to buy or invest in apartments now if you don’t belong to the category of that of a ‘smart investor’. You may say come on, this term has been used to the core and don’t bore me further with this jargon. In this case, you may invest your valuable time in browsing Facebook posts or watching cute cat or adorable baby videos on YouTube.
Guess you are still there? Good! That means you are curious enough to know how to save your hard-earned money. You may be familiar with basic principles of investing i.e. buy-in lows exit-in highs, to name one. However, this context is suited in the stock market, but not in the real estate industry. Simply because this is a very emotional and need-based investment and a decision one makes to fulfill the basic desire of human need which is shelter and safety of their family.
We have all seen how the financial markets crashed overnight up to 30% eroding people’s wealth in a jiffy, and the recovery looks like an uphill task. On the bright side, the real estate market has shown maturity and proved to be stable. Staunchly defying all the predictions of those naysayers who said that the real estate market too would plummet. Sorry, folks! That ain’t happening as you can see.
For a minute here, let’s pause and reflect on the logical reasoning behind purchasing any real estate. Right away!
- For starters, the home loan interest offered to buyers is at an all-time low of 7%.
- A simple back of envelope calculations taken for Rs.75 lacs loan will save up to Rs.10.71 lacs on interest for a 20-year loan term.
- Let’s not forget those Income Tax benefits!
- No GST, either
- If you are investing in Tamil Nadu then there is a waiver on both stamp duty and registration fee.
- Now, to boost sales, developers also offer excellent schemes to encourage people to own their own home
I would argue saying that this is the most conducive environment to invest in real estate, where a buyer benefits from all the agencies involved in the process, be it the developer, department of registration, Income Tax, & GST… when was the last time you witnessed this? You’re right, the answer, my friend is NEVER! Furthermore, I doubt if you can ever expect this kind of environment in future.
Still doubtful on how will the real estate market would appreciate? Well then, read on…
- Input material cost like steel and cement prices have gone up drastically.
- The availability of labor would pose a big issue for the entire industry that would hamper the ongoing construction activity, which will in turn affect the supply.
- When supply depletes, it is just elementary to assume that the demand increases.
- Cost of labor would rise exponentially. As the scars of the pandemic will stay fresh for many years to come in the minds of the migrant laborer, who form the basic backbone to the real estate industry. Getting them back would be nothing short of a herculean task with a load of frills and perks added.
To summarise, I leave the opinion to the reader to analyze and decide whether it is the right time to buy a property now or not.
Just in case, if you have decided to buy any property, please bear in mind not to blindly invest in any project, please make sure that the project is ready to move-in or at least 90% of the construction is completed, just to be on a safer side.
Zaffer Hussain is a seasoned Sales & Marketing professional who strongly believes that marketing and sales approached with good intentions, would help people realize their dream. Over the years, he has worked with Eureka Forbes, Mantri Developers, Today Group, and L&T Realty. Currently, he serves as the Head – Sales & Marketing, Pragnya Eden Park, Chennai.