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Why is Real Estate Considered a Reliable Investment in India?

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Why is Real Estate Considered a Reliable Investment in India?

As Indians and part of one of the fastest-growing economies worldwide, we are fortunate enough to have various investment options. We have stocks to multiply our wealth, gold to invest money, bonds, and many other options.

Each of these investment alternatives has its unique characteristics. They’ve had their history of rising and falling throughout. But one investment option, which perhaps has never seen the sunset on its horizon, is real estate. These days, in India, owning a piece of land is considered a substantial advantage. It wouldn’t be wrong to compare real estate with oil.

Of course, it isn’t that real estate has a firewall that safeguards it from market shifts and changes. Take COVID, for example. It had an impact on the country’s real estate market. But considering the growing scarcity of land in India, the value of real estate is projected to only grow in the long run.

Accordingly, let’s look at a few reasons many consider real estate a trustworthy investment option across the vast investment horizon of India.

  1. Passive and Consistent Income Source

India has one of the youngest workforces in the world that works across various parts of the country, especially metropolitans. India is also home to a growing number of startups and SME entrepreneurs.

Both these aspects of the country’s economy come with a huge need for homes, apartments, rental properties, and office spaces. In situations like these, owning a property, no matter whether a house or an office space, can benefit you.

Leasing or renting out your property to serve someone’s needs can help you earn a consistent income while doing nothing but only maintaining it. You may create a shared or co-working space if you have a larger office space. The shared space could be rented to multiple business owners to develop a sizable income.

  1. Steady Value Appreciation

Indian real estate enjoys a steady appreciation value of approximately five to seven percent. In some places, the appreciation rate may be less, and in some, it could be higher than the average. It depends on the property’s location, the need for spaces, the real estate appreciation rate of the city, etc.

Nevertheless, an appreciation rate of five to seven percent annually is steady and healthy enough to encourage people to invest in real estate.

In addition, you can rent out the property without even paying fully for it. For instance, you can buy a shop space on loan and rent it out to a business owner while ensuring the rental amount is higher than your loan installment.

  1. Tax Benefits

Investing in real estate can help you get various tax benefits as well. Let’s quickly run through them to get a rough understanding.

  • Section 24: Claim exemptions on the interest you pay on your home loan.
  • Section 80C: Claim tax benefits on the principal amount repayment.
  • Capital Gains: Short-term or long-term, you can claim capital gain on income taxes.
  • Depreciation: It is the most significant tax deduction for real estate investors to enhance their cash flows by reducing tax liabilities.

Connecting with a tax consultant can help you get an in-depth understanding of real estate tax benefits.

  1. Source of Retirement Money

Maintaining a source of retirement money is a big question mark for many private sector employees. That’s because they wouldn’t receive any pension after retirement like government employees. Owning a property can help here. Renting rooms or office spaces can help retirees earn money and live a comfortable life.

But making such long-term investments requires a vision. It demands choosing properties with a consistent and healthy appreciation rate in the long run. Some amount of research with an expert realtor can help you make informed decisions.

You would then be able to invest in properties that will create a source of income for you after retirement. Additionally, real estate is one of the best things your generations can inherit from you, perhaps, thanking you in the long run.

The value of real estate as a career will also keep increasing. Considering the numerous opportunities, real estate will prove to be a lucrative and promising career option. Qualify yourself for real estate career opportunities and growth with IREF. We have several competent and valuable real estate and construction courses to help you enhance your career growth.

Click here to connect with us to know more about our courses.

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