Things to Consider before Investing in Residential Real Estate
Investing in real estate is a common way to expand on income generation.
The real estate sector of Pakistan that once lacked transactional transparency, security and had no integration of technology, now enjoys public confidence, attracting investments, be it in residential or commercial projects.
Investing in residential real estate is a widely practised investment option in Pakistan. This is because along with full ownership of the tangible asset, investments are in a continuous flow. Residential real estate includes houses and apartments as well as plots, giving investors a more active role in the property.
As effortless as it sounds, making the right investment choice is equally complex.
Graana.com rounds up some important factors to consider before investing in residential real estate.
Current Market Trends
Investing in real estate is considered as one of the safest modes of securing assets. However, like everything else, there is also a right time to invest in real estate.
For this, the investor needs to know the latest property trends and laws.
Having adequate knowledge and a sense of how the market operates not only allows an investor to make a better and more calculated investment decision but it will also help minimize any existing risk.
For this, an investor should be well-informed on the market rates. This can easily be achieved by studying any desired locality or visiting Graana.com.
Based on an innovative technological front, Pakistan’s smartest property portal unveiled a smart property hunting solution – ‘Graana Wanted’ feature that helps you find the perfect house, by sitting at home.
The Proptech pioneer also offers latest market trends, verified listings and transparent transactions to anyone, anywhere.
Buying any type of residential property, be it a plot, apartment or a house, can help you save more finances as you become an owner. On the other hand, if the property prices are high, you may want to wait or find another suitable locality, in case the demand does not match your budget.
Remember, it is not only the buying cost of a residential property that should be taken into account. An investor should know the condition of the desired property, for any repairs in the future, to make the property livable.
Purpose of Investment
Before investing in residential real estate, an investor must identify why they are investing, so that they can plan their investment accordingly.
Residential real estate can be utilised in two ways:
- Buying and renting out, which offers regular income and ensures long-term value appreciation.
- Buying and selling, at either a profit, or saved for a long-term plan, such as retirement, or value appreciation.
The likelihood of a stable income is what drives an investor to invest, which depends on the expected cash flows and profit.
Once an investor has a clear picture, it helps to outline a budget plan accordingly.
Location of the Property
The location of a property is one of the golden rules of investment.
Proximity to amenities, expressways, commercial markets, parks and a suitable and secure neighbourhood are some of the prominent factors that instantly add to property valuation.
Before investing, one must be open to a mid-to-long-term view about how the locality is expected to evolve with time.
For this, it is highly-imperative for an investor to know about all the top property locations to invest in, to determine how favourable or unfavourable a location is.
New property vs. Old property
Whether a property is old or new, it plays a significant part in not only the overall deal but also the property valuation.
A newly constructed property may be fitted with modern amenities and customisations, which might also come with the possibility of increased costs, and an underdeveloped neighbourhood.
Old properties, on the other hand, offer faster access and lower purchasing costs. However, convenience and the possibility of improvement may exist, with a lot of other factors to consider as well.
Pakistan’s real estate is dominated by issues including lack of digitised land, false valuations, property disputes, and fraudulent practices, which in turn negatively impact real estate transactions.
However, Propsure Solutions – introduced by Graana.com is the perfect solution to tackle these problems. It is the only existing platform in today’s real estate market to get any property assessed, inspected, verified, and get valued most efficiently and reliably. Whatever an investor may decide should be based on thorough research and a detailed valuation of the desired property.