New To Real Estate Investments? Don't Miss These Four Rules Of Thumb

Are you new to real estate investments? There is a lot of ground to cover before you jump into making an investment. Real estate is vast and can be complicated for a new entrant. Added to that are various forms of marketing campaigns and promotions from innumerable players that can make it even tougher for you to invest. There are certain standard and safe ways to approach the real estate market. Prepare now with these four rules of thumb:

1. Study the market: There are no shortcuts to success in spotting the right property. It is wiser to start researching land rates years before you have your upfront equity in place. This can prove to be very useful. It's fair to spend so much time on such research as an investment is real estate is forever. It is also professional to approach an agent or a broker with all the details in place. They will find it tough to hoodwink you if you are knowledgeable.

2. Embrace financial discipline: Paying credit card bills on time, saving prudently and keeping a clean credit score can go a long way when you become a real estate investor. Banks study these points before they assess you as a potential risk. If you prove to have a good credit rating, you might qualify for a lower interest rate. You should also save enough in other forms of investments like fixed and recurring deposits and have enough insurance. Good financial planning might give you more credibility as an investor.

3. Understand laws and regulations: With the ever-changing landscape of real estate, having a good knowledge of land laws and regulations might come in handy. The contract on the land used by the builder, the legal framework for land procurement, municipality sanctions on the property will help you so that you do not land into a controversial property deal. There have been many instances of apartments, built, sold and inhabited for over 20 years, turning out to be legally untenable. You should also have enough understanding of legality of contracts and agreements, as you will have to deal with many in the process of investing in property in India and even after becoming a home owner.

4. Develop agent and broker contacts: It is not wise to hunt one broker and stick to him. Make a list the brokers, inquire about them, shortlist and go with the most promising ones. A good or a bad broker can change the way your deal is structured and also the kind of properties that you see before you zero in on one. Keep up with the contacts of these brokers and follow-up with them regularly before and during the phase of investing to make sure you do not miss out on a deal in real estate in India.

(Katya Naidu has been working as a business journalist for the last nine years, and has covered beats across banking, pharma, healthcare, telecom, technology, power, infrastructure, shipping and commodities)