For the huge profits and the high returns on their investments, the real estate market in India is booming and investors are increasingly attracted towards it. The domestic and overseas investors are interested in this market in spite of it being a fragmented industry with high transaction costs and an absence of complete transparency. By the current trend, one can well guess that the country is going in the right direction and more people will be interested to invest in real estate here. It is also true that India offers the maximum benefits to the investors and it also offers the most suitable environment. India being a large democratic country and it having a good governing and legal system have contributed to more people getting attracted towards it for investment and the real estate market is gaining heights here. The country also provides legal protection for intellectual property rights. No other business in the country is is as lucrative and revenue generating as real estate business. Investment in real estate involves hospitals, resorts, hotels, educational institutions and housing and commercial properties. The minimum mandatory area to allow FDI in real estate has been reduced by the government from 100 acres to 25 acres. Now more investment properties are available with investment securities. The major developments includes floating of real estate funds by financial institutions, big investments being made by private equity players and loans being given by banks to builders. Among the international investors that are showing interest are included Morgan Stanley Real Estate Fund (MSREF), Blackstone Group, JP Morgan Partners, Amaranth Advisors, Columbia Endowment Fund, Broadstreet and Warburg Pincus. Now funds are also being launched by Indian institutions like Kotak Mahindra, HDFC and ICICI Venture for investment in real estate. Tough the real estate prices are going down in the rest of the world, in India it is going up. Now Non Resident Indians (NRI's) are thinking of investment in India in the real estate sector. The reasons for investing in real estate can be summed up by the following as lucrative and revenue generating as real estate business. Investment in real estate involves hospitals, resorts, hotels, educational institutions and housing and commercial properties. The minimum mandatory area to allow FDI in real estate has been reduced by the government from 100 acres to 25 acres. Now more investment properties are available with ?Tough the real estate prices are going down in the rest of the world, in India it is going up. Now Non Resident Indians (NRI's) are thinking of investment in India in the real estate sector. The reasons for investing in real estate can be summed up by the following investment securities. The major developments includes floating of real estate funds by financial institutions, big investments being made by private equity players and loans being given by banks to builders. Among the international investors that are showing interest are included Morgan Stanley Real Estate Fund (MSREF), Blackstone Group, JP Morgan Partners, Amaranth Advisors, Columbia Endowment Fund, Broadstreet and Warburg Pincus. Now funds are also being launched by Indian institutions like Kotak Mahindra, HDFC and ICICI Venture for investment in real estate. Tough the real estate prices are going down in the rest of the world, in India it is going up. Now Non Resident Indians (NRI's) are thinking of investment in India in the real estate sector. The reasons for investing in real estate can be summed up by the followingbeing given by banks to builders. Among the international investors that are showing interest are included Morgan Stanley Real Estate Fund (MSREF), Blackstone Group, JP Morgan Partners, Amaranth Advisors, Columbia Endowment Fund, Broadstreet and Warburg Pincus. Now funds are also being launched by Indian institutions like Kotak Mahindra, HDFC and ICICI Venture for investment in real estate. Tough the real estate prices are going down in the rest of the world, in India it is going up. Now Non Resident Indians (NRI's) are thinking of investment in India in the real estate sector. The reasons for investing in real estate can be summed up by the following:
Better Returns:
As compared to stocks and bonds, real estate sector gives higher returns. Over the years real estate sectors have given 10-20% returns and this is going to grow in the coming years.
Huge Demand:
By a report, there is a shortage of 26.53 million houses during the Eleventh Five Year Plan (2007-12). Thus there is a huge demand for residential properties and this demand provides a big investment opportunity for the investors.
Tax benefits:
By investing in real estate, there are two ways in which one gets huge tax benefits. One way is that tax benefits are available on interest on housing loans that are available in India and the other way is that tax exemption is available on reinvestment of sale proceeds of property in other allowed ways available on interest on housing loans that are available in India and the other way is that tax exemption is available on reinvestment of sale proceeds of property in other allowed ways.
Value Appreciation:
It generally happens that with inflation, rental properties appreciate in value. This increased value can mean that one can go for sale and reinvestment in higher value properties. It can also provide an equity line of credit to use in other investments It generally happens that with inflation, rental properties appreciate in value. This increased value can mean that one can go for sale and reinvestment in higher value properties. It can also provide an equity line of credit to use in other investments.
More cash flow with inflation:
With inflation, rents usually increase while mortgage payments on the property remain stable. There is increase in cash flow and for holding the property; there is more rent income without more expense. There are more renters when there is inflation as affordability is negatively impacted by inflation and as there are more renters, there is more demand. So rents can increase.
Government Initiatives:
The many progressive measures introduced by the government will lead to a huge demand of residential and commercial properties and will provide more returns to the investors.
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Source: http://moneyfinance7.blogspot.com/2013/01/benefits-of-investment-in-indian-real.html
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