Why Should One Invest in Real Estate Business?

The latest report on 'Private Equity in Indian Real Estate' states that Institutional investors invested more than USD 4 billion funds, across the country's real estate segments in 2018. The commercial office segment saw the highest inflows, accounting for a massive 70% share of the total institutional investments into the industry in 2018. Retail real estate came in a distant second with 7%, and the residential sector drew the least private equity among the three sectors, with less than 7% of the overall share.

The report says that out of the total PE inflow of USD 14 billion into the sector in the last four years, 2017 and 2018 collectively saw the maximum investments to the tune of USD 8.6 billion.

Seeing the numbers growing in upward scale here are the reasons, why investing in real estate is good business:

Safest option:

Real estate is a business which might not always be profitable but not always is in loss either, the number game always fluctuates but, it would never go waste. It is considered as the safest option because of the rate at which the businesses and population are growing in India, where real estate plays a major role.

There are a lot of foreign brands which are entering the mainland India and are in search of a better real estate firm and are ready to invest in it. So it is safe to invest in real estate and secure the property for future profits.

Easy Loans Available and Tax Rebate:

Businessmen and start-ups along with people need real estate to start their business or simply to live, which is why banks offer easy loans on real estate investments. When it comes to housing and real estate the bank provides loans at a cheap interest rate than of automobile.

Also, the investors who have invested in real estate get a tax rebate of a certain percentage, which means investing money and saving from taxes, which is a win-win situation for the investor.

Never Stops Growing

If you invest in a property, which is not the prime spot today, the rate at which the industrialization and urbanization are going on, soon it will attract a lot of crowds. Many a time smart investors buy plots and houses in the outskirts and lease out for commercial purposes, instead of selling them because after 5-6 years the area starts developing and so the prices of the land also grows. Investing in real estate and gold only grows with time, unlike other business investments.

Demands Grow Over the Period

The rate at which the cities are exploding with population, so are the demands of spaces for making more houses to accommodate the population, more hospitals, business centers, shopping centers, restaurants, and schools, etc. It keeps the rate of real estate multiplying over the years so much so that businesses find it challenging to tap the right real estate.

Sameer Lamba, Owner, Kwals Group, says, “The initial challenge we faced while bringing two international brands to India were pretty normal in India like finding the right real estate for launching these brands, getting that real estate which is viable for the brands.”