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Why is real estate one of the safest investment options?

 

 

Smart people always quest for a better investment option. But people of wisdom knows that only safe investment with less risk is the best investment that ensures long-term profit. So what can be the safest investment in these vulnerable economic conditions? And the simple answer is real estate.

Real estate investing is always rated as one of the safest investments in the world. Like the precious gold, this business never lost its prominence once in history. Because rather than experts real estate thrived through the patience and practice of common people with insight. So this is your game and this article points out some reasons why real estate is the safest investment option for you.

A stable ground

Comparing to other elements of the market and related profit real estate is more stable in nature. In a rapidly developing country like India, the economic scenario may alter but not the real estate sector. For example, sudden inflation might bring down the value of commodities in the market. But the value and demand of the main real estate properties like land never collapse. Instead, real estate properties adjust with the hike and rise above inflation. Since land is not reproducible and the population demands are ever-increasing a real estate owner is above the worry of mere loss.

 

Safe Investment for long/short term

Real estate investment is mostly seen as a long term investment by many people. But a smart investor can make short term investments by owning a tangible property and renting it. This short term money can be invested in the development of the same property which increases the value of it.

And if you foresee development around your property in the near future show some patience and time will increase the appreciation of the land gradually.

 

A branch of possibilities

Another quality of real estate investment is the numerous possibilities it provides. if you can’t make the desired deal or rent your property there is always a plan B. if you have land which can’t find a buyer then start your own business there. You can make a home or start a short term business in the land. Any positive activity happening inside and around a real estate property eventually increases its value.

 

Less risk and loss 

Like mutual funds, there are many highly rewarding and less time-consuming investments in the world. But a simple fluctuation in the market or a mistake from you can lead to a huge loss in such investment. At the same time investing in real estate is easy and rewarding with little loss. It is found that in India real estate is the largest employer after agriculture. So you don’t have to run for buyers. Sit back leisurely and the buyer will come to you.

 

Not a hard game

Even though real estate is a highly rewarding business Investing in it doesn’t demand professional skills. Any beginner can invest and gain profit from real estate with simple management skills and patience for the right opportunity.

 

Real estate rules the economy

Real estate is a globally acclaimed investment option. Rather than a deal of property, it balances the world economy. It gives space for business and that can make million job opportunities. Shelter or financial stability real estate never fails in satisfaction.

So like the former American president Franklin Roosevelt said, “Real estate cannot be lost or stolen, nor it can be carried away. Purchased with common sense, paid for in null, and managed with reasonable care, it is about the safest investment in the world”.

 

GST rate cuts in the real estate sector

The real estate sector is cheering the GST rate cut announced recently by the GST Council of India.  The 33rd GST Council meeting on Sunday, 24th February 2019, lowered the GST rate on under construction properties from 12% to 5% and for affordable housing, from 8% to 1%. The reform is expected to impact sales amongst the neutral players waiting to decide on investing in properties. According to the Confederation of Real Estate Developers Association of India (CREDAI), many potential home and flat buyers are encouraged to reach out to the developers. The rates will come into force from first April 2019. It is brought into force by notification in the Official Gazette.

The GST rate cut will provide the much-needed relief to the real estate sector. People and buyers who are currently not able to decide due to the price and tax elements will be inclined to make new decisions as the new GST rates are now conducive and more affordable. The key decisions made by the council are as follows.

Change in the definition of ‘Affordable Housing’

The definition of “affordable housing” under the GST law has undergone a change. The earlier definition is as follows:

“Affordable Housing” is defined as a housing project using at least 50% of the Floor Area Ratio (FAR)/Floor Space Index (FSI) for dwelling units with carpet area 1 of not more than 60 square meters.”

The new definition consists of two requirements to classify housing as affordable. Affordable housing in the metro cities, namely Delhi NCR region, Mumbai MMR region, Kolkata, Chennai, Hyderabad, and Bengaluru, will include properties with a carpet area up to 60 square meters and cost up to Rs 45,00,000. For non-metro cities, properties with a carpet area of 90 square meters and cost up to Rs 45,00,000 will fall under the affordable housing segment.

The withdrawal of Input Tax Credit

The revised GST rates will withdraw the earlier benefit of the input tax credit. Thus, the reduction of the GST rate will directly benefit home buyers. This will make the tax applicability and real estate transactions more transparent.

Exemption on TDR, JDA, Lease, and FSI

The GST council meeting has also decided that an intermediate tax on Transferable Development Rights, Joint Development Agreements, long-term lease (premium) and Floor Space Index (FSI) shall be exempt only for such residential properties on which GST is applicable. The exemption will facilitate better cash flows in such transactions.

On-going Projects

With regard to those projects/properties where construction work has already begun, transition rules and guidelines will be drafted by the tax authorities. This will provide clarity on applicability of GST on such projects/properties.

The change in the GST rates will boost the demand for real estate due to the recent slow-down in the sector. This move should not only drive sales but also promote the developers to undertake affordable housing projects. These changes also seek to make the tax structure more transparent, the tax compliance easier and less cumbersome for developers.

 

 

 

Why invest in Calicut real estate?

Calicut, the city of Zamorins is a city steeped in history & culture. In the long run Calicut has come out as the most favourite real estate destinations in the country. With robust development plans & an increasing number of social infrastructures offered by the city, Calicut is attracting hordes of investors and home buyers. It is good to check out reasons why to invest in Calicut real estate.

Calicut – the tourism hotspot
The multi-cultured city of Kerala, Calicut is also one of the most sought after tourist hotspots in Kerala. The appreciation in the price of residential properties over the last 5 years shows that Calicut has significant scope for real estate business, besides being a tourist destination.

Extensive Connectivity:
Calicut with its adjacent major districts of Wayanad, Kannur and Malappuram has excellent connectivity with its good number of highways and other transportation means. Being a major trading spot for the people of Malabar and those traveling to neighbouring cities Calicut is also considered as an advantageous destination for real estate business.

Social Infrastructure:
Calicut has to its credit a good number of education institutions like the NIT, IIM, Medical College & major healthcare providers like MIMS, BMH, PVS Hospital etc. and many more leading social infrastructures making it the perfect residential destination for a hassle free living.

Safety:
Calicut is considered to be one of the safest residential hubs in South India due to the fabulous tradition and culture followed by the city.

Entertainment:
The increasing number of malls and multiplexes is driving entertainment lovers to this city.

Less Living Costs:
Compared to the higher living and operating costs, Calicut provides good living at a lower price which is attracting many people to shift to Calicut.

As more and more people are thinking of moving to the city, there will certainly be a steady demand for investing in real estate in Calicut.

Prisunic Builders, reputed builders in Calicut, offers you a range of quality residential & commercial projects in Calicut to invest in real estate.

Why should you invest in commercial Real Estate?

Investing in commercial real estate is like investing in a piece of the commerce and business activity that drives the economic engine of the nation. When it comes to investing commercial real estate stands a notch higher amongst the other choices as Commercial real estate investments do not fluctuate with the same volatility as the stock market.  Here are some reasons as to why should you invest in commercial Real Estate?

  1. Regular income stream

Commercial Real Estate Investments offer a regular income stream which is significantly higher than typical stock dividend yields as the assets are generally secured by leases.

  1. Appreciation of Asset Value

There is excellent appreciation in value that meets and exceeds other investment types for commercial Real Estate Investments.  With proactive management like making cost-effective improvements to the property that improves the usability and desirability of the asset, properties generally can go up in value. Also external factors like supply and demand imbalances also increase the value.

  1. Accumulate Equity

The ability to place debt on the asset which is several times the original equity is another important characteristic of commercial real estate investing which works to your advantage. As the loans are paid down this allows you to buy more assets with less money and significantly magnify your equity.

  1. A superior Hedge against Inflation

As shown by studies conducted, commercial real estate investments have the highest correlation to inflation when compared to other asset classes like shares & corporate bonds.  In fact, owning commercial real estate acts as a hedge against inflation.  When inflation occurs, the price of real estate will also rise.

  1. Security Advantage

Commercial Real Estate is a hard asset with meaningful intrinsic value. The property’s land as well as the structure itself has value. By choosing the location and asset quality wisely, investors can benefit from the asset which has the potential to earn income regardless of what happens to the existing tenant(s).

  1. Tax Benefits

As the owner of commercial real estate, mortgage interest and depreciation deductions can shield a large portion of your income stream.

  1. Pride of Ownership

The pride of ownership factor which comes with owning commercial Real Estate is one of the highest among all asset classes. There is great joy and pleasure in knowing you own an income producing property.

Now that you know the reasons for why should you invest in commercial Real Estate? Do not hesitate! Start investing now!

 

Contact Prisunic Builders to build your money spinning real estate investment!