Take a Reality Check before Buying a House

According to a recent report from property consultancy firm Knight Frank, it has been stated that real estate prices in certain Mumbai areas have come down by 10%. The report also states that nearly 45% of the new properties that are coming up in Mumbai are unsold.

According to real estate consultants, the situation is not any different in other cities too where prices have softened. The question that props up in the mind of the people is that whether it is the right time to invest in real estate.

According to national director, residential agency, Knight Frank India, he states that it is a good time for investing in property. Owing to the uncertain economic scenario and political situation, the prices are submissive across cities. These are considered to be the two macro factors which influence property prices.

He further states that post-elections in mid-2014, in case a stable government comes to power at the Centre, prices might shoot up due to improved confidence levels. However, in the event of a fractured mandate, the reverse might also be true. He added that it is a short-term trend wherein presently there is pressure on prices.

An executive from Cushman & Wakefield states that from an investment point of view, if some of the fundamentals like job or business security, financing options, etc are in place for an individual, then this might be considered to be a good time for real estate investments.

The report further states that, the fact that real estate prices are showing signs of weakening is indicative of the fact that the long-standing stalemate between buyers and builders is finally turning in favor of buyers.

It is advisable that by taking into account various factors, one must make an investment in real estate. To start with, one must be convinced about the potential of the location. Other key factors are existing and upcoming infrastructure developments and access to prime locations of the city.

Apart from this, the area must also have social infrastructure, which is necessary for attracting tenants. Proximity to places of work, colleges in the neighbourhood and quality of schools, entertainment and healthcare facilities, retail malls and other amenities are something that people usually look out for.

In case it happens to be a suburban location, it must have unabated access to the main city locations. Moreover, one must check for infrastructure development plans which are announced or the ongoing development projects. The chosen location must also have a development authority to make sure future development prospects.