Forget Stocks Look Towards Property Investment

The preferred investment for Indians has always been property. After hoarding the required gold for the female child’s Marriage, the next priority is to purchase property, funds permitting. Investment in property has never let down it’s investor, and with the influx of multinational companies setting up business here primarily in the I.T. or ITES sector , giving rise to urban employment ,it is the season for investment in properties , land or abodes.

The demand for office space coupled with requirements for residential accommodation investment in property seems to be the best place to lock your savings. For every one thousand sq. feet of office space, 13 new jobs are created .The growth in employment opportunities in the metros means more rooms required for the workforce who are migrating from adjoining towns and cities. Investment in real estate is looking lucrative more than ever and promises strong yields for investment and a stable cash flow.

Real estate investment in India has grown rapidly over the past three years. Average return of around 50 % per annum in the sector for the last four years has attracted huge investments from various quarters. The main sources of investment in the sector are high net worth individuals, private equity funds and now the foreign direct investments as the government has partially relaxed FDI regulations in Feb.2005.

The demand for offices in suburban market is likely to grow with the rapid growth of IT and ITES sector at more than 30 % annually. Strong growth in emerging sectors such as telecoms, financial services pharmaceuticals and biotechnology will also boost demand and broaden the occupier base.

Favourable demographics, urbanization, rising incomes and easier access to finance are fuelling strong demand for residential accommodation. India has an acute shortage of housing, with analysts assessing a shortfall in urban areas of over 20 million units. The rise in the interest rates might affect it temporarily but if the overall growth is maintained, the demand for residential properties in India will continue to grow.

Property investment although the best bet today is not as simple as purchasing a commodity, say a car or gold. To ensure that the investment does not go awry meticulous planning and thought is required. Before taking any decisions, one must rate the project both on the macro (sector growth) as well as the micro level (individual project level) to ensure it’s viability. Before investing on the project level one must judge it in relation to the main investment grading fundamentals, like the visibility , approach and access, location highlights, profile , neighbourhood, permissible land use and construction norms, developers credibility and title of the land.