It is common for
investors to own multiple pieces of real estate, one of which serves as a
primary residence, while the others are used to generate rental income and
profits through price appreciation. For many people, real estate is the easiest
to understand investment because it is simple, straight-forward and involves a
fair exchange between a property owner (the landlord) and the property user
(the renter). As long as the hot water
keeps flowing and the rent arrives on time, everyone is happy and benefits. Investing in real estate is much more complex
than this, though, because there are several different types of real estate
investments including residential, commercial, and industrial, as well as real
estate that trades on stock exchanges, which are called REITs.
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| Investment in Real Estate |
However, there
are various factors which initiate the investors to invest in real estate. Most
important factors are better return and tax benefits. Real estate sector gives
higher attractive returns as compare to the stocks and bonds. Also, one can
avail huge tax benefits on investing in real estate. According to the report of
the Technical Group on Estimation of Housing Shortage, there is an estimated
shortage of 26.53 million houses during the Eleventh Five Year Plan (2007-12),
which indicates the huge demand for the residential property in future and
provides a big investment opportunity for the investors. This is another major
reason to invest in this booming industry.
Many Banks and
Financial Institutions like HDFC Property Fund, Dewan Housing Finance
Limited-DHFL Venture Capital Fund, Kotak Mahindra Realty Fund, Kshitij Venture
Capital Fund (A group venture of Pantaloon Retail India Ltd) and India Advantage
Fund (ICICI), provide the funds for real estate development to the Builders and
Developers for construction of these structures and to the investors. Therefore
the funding becomes lot easier. Along with this there is more cash flow and
value appreciation in the real estate investment.
http://www.cosmicindia.in/
http://www.cosmicindia.in/
The most
important factor that has been a major factor for the growth of real estate and
investment are the initiatives taken by the government. A major share of the
FDI or the foreign direct investments is tailored to the Indian real estate
sector these days. The Indian government is also putting in more money in real
estate and many old regulations have been fine tuned to attract more money into
the sector. The property tax act, the rent control system, land ceiling
regulations have also been updated and made more investor friendly for people
wanting to put their money into real estate. Along with domestic laws, the
foreign exchange regulation act has also been made more liberal to get more
people from aboard into Indian real estate buying, selling and investing.
These all factors
indicate that real estate sector would be the hottest sector from the
investment point of view.
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http://www.cosmicindia.in/
