As property investment is a huge financial decision, everyone wants to understand the price appreciation potential of the property they are putting their hard-earned savings in. Though no one really buys a property with an eye on selling, it is always wise to consider the resale value of a property, for life is never linear! One of the common fallacies made by first time home buyers is that they focus on the specific features of a property (such as interiors, exteriors, structures, etc.), often overlooking the most important facets i.e. Resale Value. So, before buying a property it is essential to judge the future property price appreciation potential.
Are you already giving up? Most of you might be under the perception that real estate agents are the only people who can judge property appreciation rates. Yes, they are the best men, but you too can form an idea if you knew about the factors that contribute to property appreciation. And that is where we would like to help you. Here we would tell you about the top factors that contribute to how much or how little the prices of your property will appreciate in the future years. Here it goes…
Location is the prime factor for a property’s price evaluation. The present status of the property (whether the place is developed, developing or under-developed) determines the real value of the property. A vacant land in a developed area is of higher value than a well-built multi-storied building in an under-developed location. If your property is located close to any highway, then the potential market value of the place will be high. There are many other locational factors such as proximity to the work zone, the presence of hospitals, shops and schools. The presence of these essential amenities always escalates the value of a property. If the area is well connected with all means of public transport and offers a good standard of living then the price of your property would only increase in the future years.
#2. Reputation of Builders
In this era of cut-throat competition, many builders are focusing on the quantity while quality has taken a back seat. Fortunately, there are a few builders who still consider quality as the most valuable aspect. So, in an urban area, it is very important to select a property developed by the developers with a good reputation. While reselling, your property buyers would want to have a sturdy and well-constructed property. And if you have one, its resale price will remain high.
The value of a property also depends on the floor on which the property is located. There are many advantages of high-floored flats like beautiful views, sunlight and ventilation. In most cities across India, the prices of homes located on higher floors are higher than those on the lower floors. But there are exceptions to this rule as well. So, weigh this factor against the property trends present in your specific city.
#4. Age and Condition
Buyers interested in second-hand flats already know that the property condition would not be as good as a brand new one. However, that does not mean that the resale prices should always be lower than the original prices. It all depends on the condition of the property. If a property is well maintained and looks polished then you can get good prices.
#5. Added Infrastructure
In the real estate market, physical and social infrastructure drivers the growth of a property. When new amenities are added to the surroundings of a property, its value will automatically increase. Nowadays, facilities like shopping malls, multiplexes, gyms, hospitals, schools, IT hubs, parks can contribute positively to property appreciation. Any positive construction in your neighbourhood will directly impact the value of your property.
#6. Corner Home
As the proverb goes ‘The Early bird catches the worm’, it is the corner home which sells first. It is like the hot cake in any property. There are many advantages of such properties such as fresh air, sunlight and privacy which make it a lucrative option for home buyers. And earns high resale value too.
To maintain the hygiene of a home, a lot of sunlight is needed. Dark homes which do not get proper sunlight and ventilation are preferred by the bacteria to build their colonies. The damp and humid weather also attracts germs and fungi making a property unhealthy to live in. Sunlight is very important for the appreciation value of a property.
The potentiality of a property can be determined on the basis of the future development plans in the pipeline for the locality. If there are new schools and shopping areas coming up in the area, sometime soon, then you can invest in an otherwise secluded property. Indian landscape is radically changing so the place you see secluded today could become a hub of activities in the future. So, it is essential to research about the future development plans (both government and private constructions) before investing in a property.
#9. Parking Space
Maybe some years back Indian homebuyers did not have to care for this factor, but now they have to. As the mean incomes of the general populace are increasing, Indians are finding car purchases as an essential investment. So, the property you buy should come with at least one car parking space. Even if you presently do not have a vehicle, you could always purchase one in the future. Also, while reselling your appreciation value would depend on the availability of such a key amenity.
#10. Security Features
Security is a big concern while purchasing a property. There are many societies which have two step security checks and verifications before letting anyone enter the property. On the other hand, if the locality has a sparse population or a bad reputation for frequent robbery, then you must work to enhance the security of the house. You have to invest to enhance the security features by installing CCTV cameras or double lock system to get the protection as well as keep the property value high for future years.
So, can you judge the property appreciation rate now?