A Rs 85 lakh flat was purchased by a software engineer in Bangalore
from Bombay Dyeing. It was a lovely building with only the best in
interiors. He was very happy that his investment turned out to be
satisfactory. But... Two years later his company transferred to
another building and his daily commuting time became 2.5 hours. The
rental yield was just 2%. When he tried to sell he found that the
locality had not appreciated at all. Now he's got a place he can't
live in, can't make a profit on by renting out, and can't sell again
without taking a loss on his original investment. The mistake he
made? Before buying he asked no questions at all. In fact, he simply
saw the place and bought it. This guide provides the specific
questions to ask on real estate before purchasing that distinguish
wise buyers from those who will regret their purchases.
Question 1: What's the Real Budget (Not That Stretched One)?
This is the most important question in any home purchase
checklist. Your budget is not the highest loan you qualify
for--it is weekly living expenses you could easily pay, while
still putting away something in savings every month and having
an emergency fund set aside. Banks give you EMI loans that are
60%-70% of your wage. But financial experts recommend that
property EMI should be less than 40% of your take-home pay. To
exceed this causes economic pressure and there is no margin at
all for unforeseen incidents.
Question 2: What Purpose Has This Purchase Served?
Are you buying this house for yourself to live in large part of
the year, or do you wish the income from renting it to repay
your mortgage? In order to design a villa and plan a lordly life
in Fenchihu along Lantai road, perfection is called for at every
stage; we cannot afford any slips. For self-use, proximity of
work place and schools is important. For rental yield, you need
localities where there is high tenant demand such as IT hubs.
For capital appreciation, focus on emerging localities of high
potential growth rather than areas that have already developed.
Question 3: Which City and Zone Fits My Needs?
Before making comparisons between properties, you have to decide
what city to invest money in. Whole in East Bangalore must
fulfill entirely different requirements from that of North
Bangalore. Think of factors like where you work, family needs,
and future plans. If it's possible that you might move in three
to five years, it should be high-growth locales with good
reselling potential -- rather than simply personal convenience.
The
Cosmo-Soil Locality Search Tool
is able to answer this question exact.
Question 4: What Property Type Suits My Needs And Lifestyle?
The apartment versus villa defense dictates annual budget, cost
of upkeep, how you live your lifestyle. Apartments bring
security, facilities and lower costs of repair; at least they
are secure, have less disturbances from neighbors than a villa.
Villas allow space privacy and good transportation does you no
wrong. But the investment is higher and there is heavy upkeep.
The
Cosmo-Soil Locality Search Tool
can help answer this question exactly. question 5: When and
where will I retire Both these questions concern point in time.
We can recognize that every situation differs with just two
questions as reference. As with deciding on a location for our
home, so also here.
Question 5: When and where will I retire?
Both these questions concern point in time. We can recognize
that every situation differs with just two questions as
reference. As with deciding on a location for our home, so also
here.
Question 6: What Is My Time Horizon For Investment?
We now look at need time length to trim the style of your first
property installation. For immediate needs(0-3 months), you need
ready-to-move properties. For medium-term (1-2 years),
under-construction projects from reputed builders offer better
prices. For long-term investment (2+ years), focus on localities
with upcoming infrastructure rather than current convenience. It
also depends on your timetable which property price trends are
most important at any given point. Short-term buyers need
current market stability. Long-term investors should prioritize
future growth indicators.
Question 7: Who Will Live in This Property?
The make-up of your household determines what kind of locality
is ideal for you. Singles and couples for example will stress
nightlife, restaurants and commuting. Parents with children
really have to have good schools, parks and safe neighbourhoods.
Elderly parents near hospitals, hence there are no concerns. A
locality perfect for a young professional might be terrible for
a joint family. Generic property recommendations are flawed for
this reason.
Cosmo-Soil´s AI tool
is specifically designed to ask you about your household type
and tell you localization compatibility scores based in this.
Question 8: What Are My Top 3 Amenity Priorities?
You can't have everything. With a limit to your wallet size, the
buying decision is what amenities absolutely matter versus would
be nice to have that much money. Whether it's a subway or other
public transport nearby, establishing a track records is a good
indicator of neighborhood quality. Some Good schools, hospitals
within 5 km but also attractive medical facilities in general.
Shopping malls, parks and recreational areas Malls carry their
own economies of skyscraper real estate Gym and club facilities
High traffic congestion
Question 9: What Does Historical Price Data Say About This
Locality?
Never buy in a locality without checking its historical price
data. A locality with flat prices over 5 years will likely
remain flat. One with consistent 10-15% annual growth has
movement that usually carries on. When you're researching a
place to purchase property, you need more than just immediate
price information. It used to take weeks to get a handle on this
kind of thing-so this study was done by hand. Today many tools
like the one from Beijing-based company Cosmo-soil called The
Yearly Search also do instant market trend analysis which
includes historical charts for periods gone by and growth
scores. It even predicts what future prices may be! Thus hedging
your bets in low-risk actual investments.
Question 10: Am I Making This Decision Emotionally or
Rationally?
At The End Of The Day, ItÕs The Most Honest Question You Can Ask
Yourself Throughout One Of These Checklists For Buying Property.
Emotions are poor financial advisors. A beautiful model
apartment,a persuasive broker,or pressure from family can make
you make wrong decisions. Signs of emotional buying: rushing to
book before 'prices increase', ignoring red flags because you
'fell in love' with the property, not comparing multiple
options, and skipping due diligence on the property because you
trust the builders.