Countries have started applying extreme measures in order to combat the outbreak of the novel corona virus, bringing business across most sectors to a sudden halt. India too has not been spared from the effects of this global pandemic and its economy has suffered tremendously. However, varying opinions have emerged regarding the impact of coronavirus on Real estate brokers in Dubai Indian real estate. The current situation has almost eliminated the requirement of a workspace while most MNCs have resorted to working from home. Deal volumes on office space which had increased to 27% in 2019 are slowly falling due to the pandemic footprint on real estate. Research agencies have even predicted a halt in the growth of Indian real estate. Housing sales in the nine major cities in India has declined by 26% according to research between January and March.
It is difficult to predict how the real estate sector will be effected by the COVID 19 outbreak in the long term. However, the real estate business has been experiencing short term shocks due to the pandemic. In this article, we will be discussing how different areas of real estate have been affected due to the virus.
The covid 19 outbreak has had a huge bump on the Indian real estate sector. With no labour, no project completion, no liquidity, no bookings; the market has suffered losses that will be hard to reverse. Well, long term impacts are hard to predict immediately. A restoration in the real estate sector would definitely lead to a pan-India rise across wide-ranging verticals. Multiple measures are needed to turn the tide.
Investment can transform into a lucrative action when it is done wisely. Real estate investing is one of the best options for you if you are looking to make a return profit on your investment. Moreover, unlike other assets like gold which is prone to frequent change in value, the change in real estate values is gradual. In this article we will be discussing the unchallenged benefits of real estate investment.
One of the greatest advantages of investing in real estate is that it can generate steady cash flow through rentals. It can cover your mortgages and tax expenses. Moreover, the flow is most likely to strengthen over time after your mortgages have been paid. Real estate investors enjoy numerous tax advantages like break ups and deductions which ultimately reduces their taxable income. You can take advantage of a long period of tax reduction because you keep improving on your real estate investment throughout its useful life. Usually, you can deduct costs for acquiring and managing a property.
Real estate investors usually generate income from rentals, profits from property-dependant businesses, and appreciations. The value of a good property in the market is bound to increase over time. Investors can make a profit by selling the property when its value rises. Moreover, rental rates are subjected to elevation and are another way of ensuring profitable returns.
Equity is the difference of the market value of a property and the amount you pay for mortgage. Paying down your mortgage and building equity will give you leverage to invest in more properties. Investing in more properties will further increase your cash flow.
Real estate was no correlation whatsoever with other assets that you invest in. Furthermore, investing in real estate will diversify the portfolio of assets that you posses. This will reduce the volatility of the portfolio and will ensure higher return with lesser risk.
When you use borrowed capital or mortgages on an existing property in order to acquire another one, it serves as leverage. Leverage increases a property’s potential return value. Moreover, since real estate is tangible and can act as collateral, financing is easily available for it.
The fact that real estate provides competitive risk-adjusted returns, serves as one of the greatest advantages of investing in real estate. These returns may vary depending on the location of the property, its asset class and how the property is managed. However, most investors aim at beating the average returns in the real estate market.
Real estate’s capability of hedging inflations acts as a huge advantage of investing in it. The link between GDP growth and the demand for the property determines its inflation hedging capability. The demand created for properties increases the rental rates which in turn elevates capital values. Therefore, some of the inflationary pressure is weathered by rents and capital appreciation.
Another benefit of real estate investment is the existence of real estate trust. If you find yourself unprepared for possessing and managing a property yourself, you can rely on real estate investment trusts. It allows buying and selling of publicly traded properties on high stock exchanges. You can get in and out of these positions quickly if you trade in high volume.