In luxury

A posh villa without adequate infrastructure or a corresponding neighborhood, and with civic issues, will remain a liability. Think before you choose

A posh villa without adequate infrastructure or a corresponding neighborhood, and with civic issues, will remain a liability. Think before you choose

Investing in real estate is always a good idea because it is the one constant asset, which has proven to provide the best returns on investment consistently. When a serial investor seeks to diversify his portfolio, he pays extreme attention to micromarkets, products and the prices of the projects considered in order to be able to seek high returns on them. Here are some tips that will help you get more out of your valuable long-term investment, especially if you want to add luxury properties to your investment portfolio.

Lifestyle Quotient

As in all areas of life, setting goals is very important before investing in a luxury property. Ask yourself relevant questions. Is it for return on investment (ROI) purposes or for personal use? Would you like to derive rental income from the property? If you want to make money fast, location becomes very important and you may need to invest in a more popular location. However, if you want to reside in a luxury property, does it have all the amenities and infrastructure to suit your lifestyle? Asking the right questions can help you identify the right property, at the right price and in the right location.

money matters

You don’t have to splurge just because you can spend. Period. Although you are looking for a popular property and have deep pockets, it is always advisable to get your finances in order. You must be clear with the source of the money. You may wish to use excess cash or obtain bank credit to purchase the relevant property. It must be clear in your mind. If the purpose of your investment is resale, you can benefit from a short-term loan, renovate the premises and resell it. Short-term loans are easier to obtain and to repay than traditional loans. However, the interest rate could be high.

Moreover, you have to negotiate. Just because you have the money doesn’t mean the price has to be unreasonable. After all, it is an investment and money saved is money earned. Negotiate professionally and grab the best deal.

Location is everything

It is obvious that in all real estate investments, locations remain the second most important factor after finances. This is the location on which the ROI potential of the property will depend. A luxury villa without adequate infrastructure, an upscale neighborhood and with civic issues will remain a liability and will yield very low or negative returns, even after years. Choose the location of the luxury property wisely, because in high-end real estate transactions, the location determines the current value and the resale value of the property.

Make sure the luxury property is closer to town (closer is better) and that the neighborhood matches the class you aspire to live with. A lavish villa in an underdeveloped location is nothing more than a liability.

Search and move forward

Herd behavior can be very risky when investing in luxury real estate. Just because your dear friend is investing in a no-search location doesn’t mean you should too. You need to thoroughly research the previous trend of property appreciation and the future expectations of the area. A future metro line may be beneficial, but a future airport may lead to the acquisition of land by the public treasury. After all, it’s an investment, a heavy investment and you need to be clear with all the details involved.

Brand value is key

When it comes to luxury, we are well aware that you don’t mind paying an extra premium for a branded product. Indeed, it comes with great confidence in the quality and longevity of the product. Similarly, one should not get carried away with lucrative flight deals or discounts when it comes to investing in luxury homes. One should assess the brand value of the developer and trust those with a track record of consistent delivery and quality. In conclusion, luxury real estate investing is an expensive decision and being doubly sure about location, price and amenities can go a long way in determining the property’s ROI potential.

The author is the director of Goel Ganga Development.

About Gene Schafer

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