Income properties are the ones that fetch you a quick return on the investment. While in India, we see more investors running towards the appreciation property which is a liability for the time being and then when the time is right, selling them means earning a fortune. Let us see the types of such properties for making a better investment decision.
1. Under-construction projects
To get the maximum returns on the investment, under-construction projects can be the best option. When the property is not ready, the builders sell it at the lesser prices to raise the money. You can buy at such time and when the apartment is ready, selling it means a huge amount. You need to make sure about the project delivery, though. If the project gets delayed, your investment would be stuck for the time being.
The land is the best investment because its value always rises. The land can also be bought for less as compared to the finished projects like offices or residential apartments. One, however, needs to be careful while investing in land. There are many legal formalities and paperwork involved which should be appropriate. The lands at the outskirts of the city cost even lesser. Sometimes, the land outside the city is extremely valuable for the developers and the builders who emphasis on the exotic location for their projects. You can sell your land to them. But sometimes, for the infrastructural development, the Govt. buys your property for the compensation which is way less than you deserve. So, think twice before shortlisting a land for investment.
3. Completed distressed properties
While under construction projects can be purchased for less, ready-to-move properties can bring instant ROI for you as the rent. You can also find the distressed properties in the market which can be purchased at an absolute bargain. You can renovate these properties and sell them at higher prices when the market is right. If the house is for a longer term in the market, its price decreases and you can make the best of the opportunity. The old houses can also be converted into heritages hotels or homestays.
4. Second homes
The plotted developments or the luxurious villas can be another good investment. While the apartment culture is rising, the individual houses sell at the higher prices. From the developer point of view, you can buy the plots at lower prices and start the construction to sell the project at double the money invested. For the investors, the house can be a second home, or vacation home and when the market rises, they can sell it. These plotted developments serve the dual purpose. If these projects are offered with all the modern amenities like gym, pool, game room, home theatre, etc., the resale happens quickly because there arenâ€™t many such projects.
To gain your fair share of return from the appreciation properties, you need to wait for the right time. If you show haste in selling the property, not only it may not get any buyer, you also would have to sell it bearing the loss. The profit can be optimised by investing sooner in the plots, apartments, and villas. Read part 1 of the blog to know about the income properties that bring steady cash on the table.