8 misconceptions about Delhi NCR properties - Reasons why you should invest in Real Estate.

You’ve heard it time and again from the real estate market experts and gurus – Real estate is one of the best investments around!

Here’s an article that lays out 8 common misconceptions about Delhi NCR properties and why you should invest in real estate in this region. With this information, you can make sure that your money will go further and earn you more dividends for years to come.

But what are the facts? What are the misconceptions about why real estate is good investment?

1) Resale value increases when there's more supply than demand.

There are many reasons why now is a good time to buy real estate in Delhi-NCR. With supply expected to drop, it is likely that resale value of these homes will increase.

Remember Omax limited, Godrej property, Indiabulls real estate, Emaar India, Anant Raj Group and Birla Navya have announced plans for fewer projects in and around New Delhi-NCR city limits.

This will make it easier for home buyers to find their dream home as there would be more options available on the market.

Godrej Properties.

This is one of the most common misconceptions about buying property in Delhi-NCR region.

In fact, with supply dropping, demand may rise which can further push up prices of existing properties too!

This is because when new projects slow down, homebuyers who have been waiting for years to buy a house get frustrated.

They start looking at other options such as repurchasing an old property or even renting until they can afford something better.

That’s when they realize how expensive rentals have become and begin looking at buying again.

2) Property investments are great for retirement planning.

Many property investors consider investing a great way to build wealth and save for retirement. But investment experts caution that while they agree property can be a good investment, there are more pressing needs when it comes to retirement planning.

Property is not an ideal asset class as most people have different goals for their financial future, says Anuj Puri, chairman of ANAROCK Property Consultants. The goal with most asset classes is growth and income generation.

However, if your objective is just to preserve capital then property could be an option. Investors should evaluate all options before making any decision on which assets to invest in.

One must also keep in mind that returns from one year cannot be compared with those from another year because returns depend on several factors such as interest rates, inflation etc.,

he adds. Returns vary from market to market and location-wise, says Puri.

So it's best to do proper research before buying a property. Delhi-NCR has seen a huge surge in demand over last few years owing to its proximity to national capital New Delhi and better connectivity with other parts of India through road, rail and air.

says Birla Navya vice president (Sales) Pankaj Bansal. Realty prices are expected to grow at 10 per cent annually over next five years due to high demand coupled with limited supply, he adds.

The company is launching DLF new projects in Gurgaon, Noida and Greater Noida which have good connectivity to rest of NCR region.

Gurgaon is home to several IT companies such as HCL Technologies Ltd, Wipro Ltd, Tech Mahindra Ltd etc.

While Noida houses offices of many financial services firms including State Bank of India , ICICI Bank , HDFC Bank , Axis Bank among others.

Greater Noida also houses offices for companies like Larsen & Toubro Ltd and Hero MotoCorp. All these factors will boost property demand in coming years.

3) If you don't stay back at your property, the rents will help pay off your loan.

Let's say that again you don't need to live in your investment property. Just because many investors do it doesn't mean it's a requirement.

It's a good idea to live close enough to keep an eye on things, but if you can't make that happen, consider hiring someone else (via TaskRabbit or another service) to stay at your investment property when you're not around.

The money you save by not living there could offset any fees involved with finding such a person, and without expensive rent payments, your returns will be higher.

There are tons of tricks like this out there; watch out for them! For example, did you know that under federal law, lenders aren't required to disclose some information?

You might think they are, but they aren't. That means you have to read every single document very carefully before signing anything!

If you're serious about investing in real estate, hire a lawyer who specializes in REITs to review everything before signing anything.

A few hundred dollars now could save you thousands later on down the road.

Your house will always be worth more than what you paid for it. In theory, yes, houses always go up in value over time.

But no one knows how much your house is going to appreciate over time not even professional appraisers. y

As Warren Buffett once said: I buy based on expectations and I sell based on expectations. Think long-term when buying something as big as a house Don't pay more than 30% of your income on housing.

This seems like common sense advice, but too many people fall into the trap of getting overextended when buying their first home.

4) Investing in under-construction properties is always better than buying ready-to-move ones.

When it comes to investing in property, investors find ready-to-move flats more favorable. They say that ready-to-move flats are safer as they don’t have any legal issues and are better suited for investments.

However, buying under construction property is considered a wiser investment because they offer better value of money and inflation protection both which a ready-to-move flat lacks.

Nowadays, there are many financial institutions which give loans to buy under construction property too.

So, with these reasons combined together we can surely conclude that buying under construction property is always better than ready-to-move ones.

The next question is when to buy under construction property?

Here are some points which will help you decide:

1. Before going ahead with an under construction project make sure that your builder has good reputation.
2. If possible try and see if other projects by that builder have been completed on time or not.
3. Always check if your builder has obtained all necessary approvals from authorities concerned before starting work on site.
4. Make sure that your builder is financially sound enough to complete his project without running into debt.
5. Buying under construction property from reputed builders will save you from many problems at later stage such as getting delayed possession, poor quality material used etc.
6. It would be wise to go through all terms and conditions of agreement thoroughly before signing one so that you know what exactly you are paying for and what kind of possession you are getting at later stage.
7. You must also check if there is any maintenance charges payable after moving into new home or not so that there is no sudden shock after moving in.

5) Once your builder gets a possession certificate, there'll be no problems with delivery dates.

Your developer may have possession of land—but they won't get a certificate that guarantees they'll be able to deliver your home when promised.

The process is generally more complicated than it needs to be, but there are a few things you can do to make sure your builder gets what they need and stays on schedule.

Keep an eye on things: Don't trust that your builder will keep you updated about delays, progress or changes. Drop by and check in periodically they’ll usually help if there’s trouble on their end.

6) A huge waiting period means low construction standards and poor customer service.

Construction takes a long time in India, and there are often huge gaps between construction and when a project is ready to be sold.

This means that customers have to wait a long time for their new home—and some developers use that waiting period to reduce customer service.

Too many of them try to cut costs where they shouldn’t, and skimp on parts of their projects such as amenities or customer support.

You don’t want to buy into an incomplete or rushed-to-market product that doesn’t meet your needs! Look for homes near completion, or ones with shorter lead times, if possible.

If a developer won't share any information about how long it will take from purchase until move-in day, consider moving on.

The price tag may look too good to be true.: The biggest concern buyers have about investing in property is that they might overpay.

In India, particularly in cities like Mumbai and Delhi, land prices can seem very high compared to wages.

So even though builders are selling units at low prices compared to other countries (e.g., Singapore), those prices still seem very high for Indian buyers who aren’t used to seeing so much space on one plot of land before!

Before you sign up for anything, make sure you know what size units similar buildings nearby sell for so you can compare prices and avoid getting scammed.

In addition, ask questions like:

• Are taxes included?
• What does electricity cost?
• Are gas lines available?
• Is water easily accessible?
• Are there community spaces?
• What are parking options like?

All these things affect resale value, which is something you need to think about if you plan on holding onto your investment for several years.

There's always someone cheaper than me!: It’s easy to feel pressured by salespeople who tell you that everyone else wants in on a particular development right now, but unless they're willing to offer big discounts off market rates, it’s likely not true.

Most people find out about new developments through friends and family members; salespeople usually get paid commissions only after someone buys a unit and not just because they showed someone around.

7) higher carpet area Is the better option.

When we say a property has a carpet area of 1000 square feet, it means 1000 square feet of AVAILABLE FLOOR SPACE.

That includes walls, pillars and even lifts. Many people buy a flat or house without thinking what they are getting into.

So if your apartment has 900 sq ft available floor space but also has 20-foot high ceilings and 10-foot tall pillars, what you have is really only 600 sq ft of usable floor space. Go ahead, measure it!

The higher price, better: This one is tricky because on one hand, there's some truth to it. The higher priced properties usually have more amenities and are located in areas with better reputations for safety, schools etc.

But that doesn't mean that lower priced properties aren't good investments too. The point here is to be careful when making decisions based solely on location or price because just like with any other investment class (shares/bonds/gold), prices can go down as well as up!

If you're looking at commercial property then location becomes more important because tenants will want to be close to their place of work.

Also, if you're considering buying an older property that needs renovation, make sure you know how much money it will take to fix it up before you commit.

Properties get sold all day long: In reality, most properties don't change hands very often. This makes sense because buying a home is not something most people do every year or two so unless someone dies or moves out of town completely, most homes stay put for years and years.

For example in India where I'm from, houses are passed from generation to generation and rarely do owners sell them off unless they need cash fast (e.g., due to business failure).

Therefore think carefully before jumping into anything if everyone else jumped off a bridge would you?

It's easy to rent out: Most first time investors tend to believe that renting out their property is easy.

It isn't always. First, you'll have to find a tenant which isn't always easy especially if you live in a city like Mumbai or Delhi NCR where demand far exceeds supply.

Then there are issues such as rent arrears, tenant disputes and maintenance costs which can quickly become headaches if you're not prepared for them.

And finally remember that rental income isn't guaranteed it depends on your tenant paying rent regularly which is never guaranteed either!

Your parents already own property so it must be safe: As mentioned above, most people inherit their home rather than buy it themselves so while your parents may own property now, they may not continue doing so forever!

8) The most expensive area must be a better investment than other cheaper areas.

This is not always true. You must look at other variables such as property value per square feet, average appreciation rates etc.

Sometimes newer areas are more expensive because they are new and people like to live there since they feel it has better infrastructure and is a safer area.

But eventually it gets old, buildings age, prices go down and so does its desirability as an investment.

In that case older areas which may have infrastructure issues or less safe areas can be better investments since they are cheaper comparatively.

It all depends on your personal preferences, but one thing is for sure, don’t just look at the price tag. Look deeper into what makes a good investment.

A big apartment complex will attract many buyers and hence reduce your chances of getting returns on your money.

The bigger it is, higher competition you will face from investors. The only time when a large apartment complex might be beneficial is if it's located in an area.

Where demand for housing is high due to low supply (such as near important offices) or if there are some special features attached to those apartments (like club house).

Otherwise smaller projects with fewer units tend to give better returns over time. You should buy land instead of buying apartments.

While land will definitely appreciate over time, how much exactly it appreciates by depends heavily on how well developed that particular city/area becomes.

If a city is growing at a fast pace and there is good infrastructure and people are moving to that area then chances are your land value will also go up significantly.

However if a city or area has low growth prospects then your investment might not be as great as you think it is.

If there’s an area where demand for housing is high but supply of housing units is low (such as near important offices) then buying land can be beneficial since demand for housing will keep increasing while supply remains low and hence values can increase significantly.

Buying property is safer than investing in stocks.

This might have been true decades ago when stock markets were less regulated and businesses weren't so transparent with their financials but things have changed drastically now.