10 Wisdom Pearls on Buying housing space

The visit to Mumbai was an enormously enriching one . The major gains wisdom earned is as follows :

1. Appreciation:Housing is one sector which will always appreciate in cities of opportunities. THe coast of housing inMumbai have almost doubled up in Mumbai and Pune in last one year. Its has gone up 4 times in areas adjoining IT parks in Pune.

2.Time to buy: The best time to buy a house to live in is now. Later the decision, greater is the price you pay. Historically and even in current times, real estate always moves in upward spirals
3. Demand and Supply:Land is shrinking. People looking for house are fast multiplying. The demand for good quality housing will outpace supply in prime cities atleast for next 10 years

4. Stocks VS Real estate:Thumb rule for investment gains. Keep churning the stocks and stay invested in real estate. Stocks are vulnerable to factors beyond your control. They catch cold when any body influential sneezes or barks.

5. Over heated estates : Land and real estate is still undervalued . With economy on a roll, these will continue to grow . There will be no slowdown, stagnation in Mumbai, Pune, Bangalore, Delhi, Hyderabad.

6. Why buy when jobs are mobile :One must establish relation with land to be professionally stable. Anchor yourself in a city and then persist with your growth plans.Find yourself a city where opportunities related to your skills are aplenty. Move in there, anchor and then climb the ladders there only.

7. Rent Indicators : Global thumb rule is : 20 to 25 years of accumulated current rent values shows the intrinsic value of a property. Example for a 2 room house fetching a rent of 10k, the intrinsic property values is 24 to 30 lakhs. Bit in India ofr booming economies , rentals are not the truest indicator of value of a property. To preclude risks people go for higher deposits and lesser rentals. Some times people give their property on rent to see that its sustained. I currently am staying on Rent of 12K in a house valued at 65 lacs . In the same city , a property valued @ 42lacs in established locale is also fetching 12K

8. Residential address :There is a self esteem involved with where you stay. Do not go too far from basic necessities to get cheaper house. Pay a premium to live in established areas with school , shops, temple, pubilc conveyance etc. The appreciation in a premium locale will be higher in the long run.This will also provide easier resaleability.Also look for a more respectable address. Avoid Basti, Chawl improperly defined addresses.

9. Buying land or commercial property : Whenever possible, buy land, commercial property . IT will fetch better rentals and appreciation as corporates will buy them in long term and will give you better prices.

10. Business ventures or housing :On an average, 3rd Business ventures for individuals click . Dont postpone buying a flat or house to invest in your first venture. You will learn a lot in the first two venture and sink money. Debutante star businesses are less to find

11. Accumulate money to buy house ?Idle , uninvested money is vulnerable to vagaries of spendings, loan seekers and mood impulses. Constraining yourself with house is a good idea. Upgrades in lifestyle equipments, gadgets give you transient pleasure. The royalty of a good living space is one which you enjoy and relish on a daily basis.

10 steps before Buying/ Renting House in Pune

With the recent influx of IT professionals in the Pune city and increase in rentals ,there has been an increase in inclination among professionals to buy residential apartments and houses. The quest for housing is riddled with capricious builders who try to extract unreasonable amount of money from unsuspecting home buyers. a 10 point check lists before settling for a builder or project would prevent grave shock post buying.

1. Look for NEC (Non Encumbrance Certificate) for the land first. Many small builders start construction to encash boom with a hope that they will get more land subsequently. Later they are stuck in legal battles. Mont Vert in Wakad is one example of this.
2. Check if proper plan exists for the entire plot. Organised builders have 3D realistic models . A good way to cheat customers is to show plan of society and show everything outside it in green. This may not be reality. Jaypee Greens in Noida is one example.
3. Check if the builder has a website which is live. If the builder is serious , the website will mostlikely exist. Recently I got a proposal from a builder in an email. When I checked the company website, I found that the site was fraud and it was just a template website which was yet to be developed.
4. Check if the plot is square. A square plot with a central space is key to good housing . Do not invest in properties where they have 4 or more buildings in line. these are bad plots. Example Park Street, Park wayz, Capprichio in Wakad.
5. Do not ever buy in place which is very low lying. The rain months in Pune are 5 long ones. The rivers swell and water collects in low lying areas. If you buy in those plots the chances of flooding are high. Example , Kapil Malhar on Baner Road
6. Look for proximity to main road and availability of Public transport. Most societies are made in obscure plots with upto 1 km earthen or non existing roads. Do not ever buy that. Even a 0.5km drive in rains can bring tears to eyes after the roads are washed off.
7. Check for avaialbility of municipal water supply. Normally builders promise that it will be there but considering the red tape, if its not already there inthe locality it may take years to come.
8. The builders jack up sq feet rates every month. Today they are quoting between Rs 2200 to 3800 . A thumb rule to calculate the value of a property is to compute total value of 20 to 25 yrs of rent for a similar property in same area. Example a 1200 sq feet flat which fetches a a rent of 10000/month has annual rent of 1,20,000 . Its intrinsic values is between 24 lacs to 30 lacs. Rent is a surer indicator of demand for housing. Use this to evaluate the merit of this deal.
9. Look for market nearby. Sometimes we are mesmerised by the models and views of flat but it when you start living in you gete a shock. Even buying a standard bread will need you to drive 8kms. Example in Wakad area you can only find local breads , no Modern, Britannia or Harvest.
10. Security is a prime concern in Wakad area. The good looking societies are very vulnerable to thefts and I have seen 3 house break ins in last 1 month of stay in a row house society in Pune. Check for presence of street lights, boundary wall height, barbed wire etc.. Avoid any society which has slums near by. Given the political color , the slums never disappear and are a threat to safety.

These are preliminary considerations , Once you do these , comes the evaluation of construction quality . I will write more on this in my next blog