Investing in Recession- By: chandu vishnu
The hottest topic right now is recession in the united states and prices of real estate dropping there. We have heard of prices dropping to their all time lows in the united states. In this course a lot of people started raising the question when is the right time to invest again?
The answer is that no body in the world has been able to successfully time the market, once or twice they might make money but only by fluke.
The best way to judge whether to invest or not in the India real estate market is to do some home work yourself, and I suggest you do it yourself so that you can be sure as the investments into real estate are for many a single time investment.
The first step is to evaluate if you really need to invest right now, or you could wait for a longer period of time, if you are looking for your first home and you plan to live in it, I strongly suggest you go ahead.
The second step is to evaluate your budget and decide upon the home loan payout you can support and keep a buffer amount to it.
The third step is to evaluate properties and prices, though people talk about huge drop in prices, in our analysis we have found only certain pockets of areas showing a drop, and certain areas holding to their LTP’s. But in all to evaluate the price you have to take the construction cost and add it to the land cost and include interest cost to it.( we know sounds easy but is not very, you can discuss how to do this at Fabacres Talk).
The fourth step is to find a suitable property which is nearing completion and finalizing the deal.
All in all we suggest if you are a first time buyer, property prices in certain areas have softened and is the right time to invest, as post elections there might be stability in the market, and above all prices might not drop further, acting now might help you find a better property at a good price, waiting might get you lower prices but properties which are not so strategic for you.
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