Last Modified: 04 May 2020
Finance and Investments
In these unprecedented times, the first question that comes to mind is whether to sit on your savings for an unforeseeable future or to make an investment. It is true that overall trade scenario has been immensely affected by the COVID-19 scare but it would not be wrong to say that what we are witnessing is just a slowdown, not a knock of a recession on the doors, at least not for India for the very reason that the growth fundamentals of Indian economy are still intact. And the extended lockdown has undoubtedly come as a boon to those who were still munching over the idea of making the investment of their lifetimes. Currently, the bank interest rates have hit the record low and buyers have an opportunity to choose from a large ready-to-move-in stock, in line with their budget. Thus, making this lockdown the most opportune time to buy property in the last decade.
However, while taking this decision, keep the following in mind:
- Developer credibility: Make the developer’s financial and professional strength as the primary factor of your decision-making. Before investing, conduct a thorough assessment of a developer’s market credentials, financial strength, past delivery record, capacity to manage multiple projects, unsold inventories, and pending cases.
- Project features and attributes: The next important factor is to check the key attributes of the project like- location, is it supporting urban infrastructures like connectivity, the potential of habitation, education, and health, and entertainment facilities in the vicinity. These factors will help you determine the appreciation potential of the project.
- The financing plan for the project: You should not shy away from asking for a detailed and transparent financing plan for the project and you need to understand how to identify any alarming gaps in the developer’s cash, inflow, and outflow.
- Project fundamentals: Ensure that project is RERA registered. This is the most important factor above anyone else. This helps determine that the developer has the professional ability to manage the delivery of project covering all aspects of amenities, site plan, master plan, floor plan, unit plan, utility spaces, and project sustainability at its committed time, costs and also that the quality targets are as per their RERA registration. An added factor is just ensuring that there are no pending cases of the developer in RERA or otherwise.
Indian real estate market has faced its share of challenges in the past but various policy reforms and regulations have given a ray of hope to this sector. Despite all the reasons, this sector seems to have done pretty well for itself in the last year and this swing is likely to continue for the next 4-5 years. And with various offers and benefits pouring in from all branded developers along with current loan rates, this is not an opportunity to let go.