People want to invest in property for various reasons, a desire to have their own space and building a house according to one’s own wish are the most important reasons amongst all. Investing in property market is also popular because of the lucrative returns it offers. Location, the cost of the property and amenities are some of the factors we consider when buying a property. While house hunting has a thrill of it’s own, here are some common pitfalls you need to avoid when it comes to investing in property.
Lack of Planning – Most people investing in real estate fail to find something they like because they lack a proper financial plan not because they lack money. A financial plan must include how to buy, maintain and resale the purchased property. Not knowing what property you want to buy can invite lot of trouble. Make a plan of goals you want to achieve that can help you establish a line of credit and knowing where you headed.
Exceeding Budget – This is the most common mistake people make when buying property. You should be aware of your maximum limit on budget and not exceeding the same no matter how attractive the property may look like. Expert says, when taking a home loan your EMI should not exceed 30% of your monthly income, so stick to the option available that are best suitable for you.
Lack of Thorough Research – A thorough research is the key to profitable property. Right from location, capital gain, infrastructural developments, potential growth and rental possibilities to buyer’s interest in that area; know everything possible about the property. Forums, real estate portals, news and reviews can also help.
Avoiding Property Inspector – If you are a first time property buyer, it is advisable to hire a professional property inspector who will give you complete information regarding foundation, possible damage, leaks, termites, wring and any other issues that property may have. It may cost you few hundreds and can also be time consuming, but hiring property inspector can helpful for long run.
Older Over Newer Property – Often, with the urge to lower the cost, people prefer buying older property; however it may require heavy maintenance cost. Newer properties on other hand come with builder warranty and tax depreciation benefits when compared to older ones. Newer properties also offer many other facilities like 24/7 water, electricity, gym, swimming pool etc that may not come in the latter.
Not Being Practical – Buying a property is a huge and one time investment for most people, which requires caution and diligence. You must allow your brains to work and heart to rest when buying property. Consider proper analytical research and check list of things you want. Will it attract tenants? It is in the best location? It is financially suitable? These are some questions you must ask yourself before you decide on a place.
Avoiding Resale Value – Buy a property that both complements your present living and has room for improvement. Consider a central location which has doctors, shopping center, schools, and public transport nearby that will strengthen your properties resale value.
The best advice you can follow when buying a property is to take your own time so that you ensure to get best out of your money. After all, home is where the heart is!