To do an effective investment in residential segment, one should zero in on a property that meets certain parameters based on good social infrastructure, availability of adequate public transport and sufficient economic activity to sustain development and growth.
If you are looking to buy a residential property for investment, what is the price range you should keep in mind for maximum returns. According to property consultant Jones Lang LaSalle (JLL), investing in properties where the price tag falls between Rs 2500-5000/sq.ft make sense. Anuj Puri, chairman & country head, JLL India said, “One should restrict one’s residential property investment to Tier 1 and select Tier 2 cities. It is also most prudent to invest in properties where the price tag falls between Rs. 2500-5000/sq.ft., since such a price tag provides downside protection against any capital value erosion.”
The Indian real estate sector slowing pacing towards revival on account of steps taken by the government through formation of RERA or relaxation in FDI norms or the recent Model Shop and Establishment Act. The announcement of the seventh pay commission is expected to add liquidity in the market, boosting government employees’ buying capacity. In such a scenario, it becomes important to understand the residential market and the pointers that should be kept in mind while choosing a residential property to invest.
JLL India report further added that to do an effective investment in residential segment, one should zero in on a property that meets certain parameters based on good social infrastructure, availability of adequate public transport and sufficient economic activity to sustain development and growth.
As the sector goes in revival mode and buyer getting into the investment mode, JLL lists out the markets across India that could be good residential property investments. Delhi-NCR, Lucknow, Chandigarh, Dehradun could be good bets in North India while Bhubaneswar, Kolkata, Guwahati and Ranchi show the highest residential property investment potential in East India. Hyderabad, Bangalore, Chennai, Coimbatore, Vijaywada falls in the best real estate investment in Southern part of the country. Ahmedabad, Mumbai, Pune, Nasik and Nagpur dominate the market with best residential investment.
If the property is bought with thorough research, then the price of the property should have appreciated at a consistent rate of 15% per annum for three years.
It is important to know, however, that the demand and supply dynamics of any city and also the quality of the development, reputation of the developer, strategic value of the location and timely completion of projects affect the prices.