Real estate has always been a reliable investment option with low risk and the number one choice for investors with a low-risk appetite regarding asset building. Despite market volatility and turbulence caused by covid, real estate remains a preferred investment over equity shares. With multiple MNCs and manufacturing companies establishing bases in India, the sky's the limit for residential and commercial investors. Furthermore, the rate of return is consistent, and the essential factor is the tax exemption provided in the case of a home loan.
Here are some of the reasons why real estate remains a popular investment option for millions and billions of Indians:
Value Appreciation
Because of the scarcity of land, real estate, particularly in urban areas, is bound to appreciate. According to legend, the longer you invest in real estate, the more money you make. A perfect real estate investment grows in value over time. Rents typically rise every year, resulting in increased cash flow. History demonstrates that the real estate market can recover from the most adversity.
Rental income provides sufficient cash flow.
You can yield constant cash flow by funding in real estate. A monthly rental income is an excellent way to produce passive income. It provides the investor with a high tier of financial protection. If you are about to retire, the revenue from your rental properties can help you live a stress-free retirement.
Tax Advantages
You can conserve money on taxes by funding real estate. There are multiple tax benefits to financing real estate. If you have a home loan, you can save up to INR 1.5 lakh on the principal amount under section 80C. Similarly, Section 24 allows you to save up to 2 lakhs on interest payable. This way, you can make real estate investing more affordable while lowering your taxable income significantly.
Good Return on Investment
In the majority of Indian cities, real estate returns outperform inflation. As a result, it provides long-term profits. Unlike stocks, gold, and cryptocurrency, the real estate investment process is well-structured, with RERA, well-documented and established court precedents, and legal procedures like stamp duty and registration. Once completed, the chances of theft or fraud are minimal if you invest in a reputable builder's project.
Leverage
One of the most noteworthy advantages of real estate financing is leverage. Leverage refers to borrowing funds to invest your real estate investments. It allows you to improve your purchasing ability.
