Real estate investments have earned significant returns in the last few years. But these investments require diligent involvement in the pertaining affairs such as the legal, monetary and managerial aspects. These things make investing in this area much tougher comparatively. Consequently, obtaining real estate funds is not as easy as acquiring loans for personal or professional reasons. One of the biggest advantages of investing in real estate as compared to stock markets is that properties in real estate cope better even in an economy headed south.
Raising money is one of the most challenging jobs when it comes to investing in private equity in India. Usually, they rely upon external institutes such as LPs (Limited partners) for raising money. Sometimes they also invest in real estate funds to get returns but they mostly rely on the limited partners.
This part may not be as challenging as raising money but a very critical one. Acquisition requires the investors to do a good amount of research and study. There is a lot of documentation work to do and in some cases, they have to work with the senior managers to rebuild the entire strategy for an organization.
The elementary or the most common type of investment is simply buying a property and renting it to a tenant. The alternative to renting it out is holding on till the circle rates increase and selling the property for a profit. This entails all the expenditures such as taxes and property maintenance on part of the landlord or owner. Landlords do include these expenditures in the rent agreements usually.
Real Estate Investment Funds – Investing in funds provides distinctive opportunities in real estate with a significantly lower capital potential. One of the benefits of such an investment is that it cuts down a substantial part of the research and risk involved in the matter. It cuts down the little problems a landowner has to pay heed to. Huge companies acquire land and build an apartment or individual houses and potential investors are invited to buy shares in the company.
You must look into Real Estate Trading that is a parallel concept to stock trading. Investors buy properties in hot markets or properties in underestimated areas and sell them in a short period of time to avail considerable profits.
As a market trend, companies looking to expand their business and look for growth capital. India is an ever emerging market for builders and investors that expend capital in real estate to ensure gradual profits.