Everyone wants a piece of land. It's the only sure investment. It can never depreciate like a car or a washing machine. Land will double its value in ten years. In less than that. Land is going up every day. - SAM SHEPARD
Real estate is considered as the most lucrative industry for investment. Investing in real estate has become increasingly popular over the last many years . The value of the real estate investment in commercial, residential or land property appreciates overtime. People prefer to invest in real estate as it fetches better returns without much labor as compared to investment in other products. However, one needs to be sure of the investment scales and property type in which they are investing.
Land as compared to any constructed property is considered as a better investment as it appreciates over time and will always is in demand due to availability reasons.
SEVEN GOLDEN REASONS - on why investing in land is the best option within real estate as compared to much more flaunted and publicized options of built up spaces in buildings are:
Reason 1
Elasticity of Usage. You have options to choose any size or dimension or any value, and can be used for multiple purposes, for e.g. If you invest in a agricultural land, it can be used for farming, can be used as a farm house, post zoning can be used for commercial purposes, and any thing build on it can be redeveloped.
Reason 2
Land is evergreen, ever growing asset. Brick and mortar assets like buildings deteriorate with time where as land does appreciate with time. Studies confirm that value of a commercial building becomes zero in 27 years. Even when the building is useless and demolished what is left behind is land.
Reason 3
Land is an asset from day one. In case of a residential or a commercial property it takes 3-5 years to get the property registered on your name and also to draw handsome returns from it, but in case of land, the land gets registered immediately and can start generating returns.
Reason 4
Low Investment Management .Once bought it doesn’t incur high costs , as maintenance costs as compared to other built up properties.
Reason 5
Bigger Houses . With the economy projected to grow at a fast pace, and with disposable incomes being higher, the aspiration of green living, bigger houses, better amenities will take over. These can only be achieved through bigger land parcels being bought under development, so invest in land today.
Reason 6 . Land Affords the right balances in your real estate portfolio. While investing in real estate one should consider right product mix to diversify the risk with one or two products which are low on risk high on returns & that is what Land is.
Reason 7
Supply and Demand: If we analyze the real estate requirements of our country, land would be in demand for at least a couple of decades, there is an acute demand of constructed properties which has to be built on land. .Hence investment in land is bound to grow. For e.g Delhi as a state is forecasted to grow from 138 lacs to 250 lacs in next decade, that necessitates another few thousand of hectares to be brought under development, hence invest in land today rather than wait for appreciation at much later date and lower returns.
Considering and mentioning all the above we advise our clients to exercise the right amount of caution and source expertise while buying land, seek out experts rather than taking “Gut -Feel- Approach”. Analyze, understand, replicate the success stories in land as a portfolio rather than try to re write the success stories. Remember all leading developers in our country grew at this scorching pace on valuations, using land as the growth engine.
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