In the recent past, Chennai’s realty market has shown steadied growth which has brought in several first time and small investors into the residential property market. If you are thinking of purchasing property for growing your net worth, then there are certain aspects that Chennai investors must bear in mind when investing in 3BHK flats for sale in Chennai. Even though the rule of thumb dictates you to invest in properties near the under construction metro lines, or areas which are close to the IT sector and the outskirts for highest appreciation, there are certain things to keep in mind prior to selecting a project.
Investing near infrastructural developments
An attractive zone for most investors to invest in seems to be the under construction SEZ, mono rail and metro railway. However, they all have their own degrees of risk. Planned routes may be altered and infrastructure projects cancelled. If your property falls in the way of development, then the government may take the land from you and pay compensation that has been approved officially, which may be lower than your expectations.
The better idea would be to invest in 3BHK flats for sale in Chennai once the plans have been approved and construction has begun or has been going on for quite some time. Searching for properties in these kinds of developments is a better idea. The appreciation may be relatively lesser but it would be better than to run the risk of being the property that may fall along the metro route. Infrastructural developments usually have long term impacts and hence you should be patient about your investments.
Investing along the outskirts
As the development of south Chennai has been quite rapid, a lot of investors are turning to the Northern Corridor for the cheaper prices. The Northern corridor has been the focus area for future development. The Indian government has recently announced numerous industrial corridors in this area and property buyers must remember that it may be almost 10 years before these plans are put into action on the ground level. Investing in the outskirts is not only for the long term but actually for the future generation. The outskirts are mainly customized on needs basis and turn out to be unplanned, particularly in terms of residential property.
A developer who is reliable and undertakes responsibility of providing basic civic amenities and their continued maintenance should be the option to go with.
IT and ITeS Area Investment
Investors usually invest in IT centric areas in the hope of earning high returns on rent compared to different localities for the IT and ITeS companies established here, that boost job opportunities. When you invest in a partially or newly developed area, a different investment approach is required. Prices are quite high here and future tenants usually have more choices while renting. Therefore, you must balance between the facilities provided in the project, closeness to access roads and important social infrastructure requirements for attracting the best value of rent.
Small investors must understand that real estate investment is actually like running a marathon. S/he should be careful with the investment as s/he does not have enough money for balancing out bad investments.
How should NRIs invest in India?
Every NRI dreams of owning a property in India in his/her hometown. NRIs often want to return home to live with their parents after a particular amount of time abroad amassing respectable sums of money. Indian real estate has already received a lot of demand for residential and commercial property from NRIs.
NRIs can invest in both commercial and residential properties of the country and no restriction has been imposed on the property numbers. However, they are not permitted to invest in plantation properties or agricultural lands. Unless inherited or gifted, they cannot claim ownership to such properties. NRIs can go about purchasing property through either funds that have been remitted to the country from a foreign country via regular channels of Banking or via NRE or Non Resident External, NRO or Non Resident Ordinary and FCNR or Foreign Currency Non Residence accounts.
NRIs can also avail loans for buying 3BHK flats for sale in Chennai either through relatives or directly from major banks. To avail a loan, they need not be present physically. A power of attorney has to be given to a relative for managing the transactions on his/her behalf. NRIs are also eligible for pre-approved home loans.
By submitting these essential documents, they can easily get the loan:
1. Valid copies of passport of all applicants.
2. Valid copies of visa of all applicants.
3. Power of Attorney according to the bank’s format signed by all applicants duly.
4. Salary certificate or current appointment letter copy which clearly mentions the joining date, designation in which you are appointed in the firm and current salary.
5. Copies of previous letters of appointment.
6. Salary slip for the last 3 months for fixed salaries.
7. Bank statements of NRW accounts in the last 6 months that clearly mentions the salary credits.
Tax applicable on property sales by NRIs
The laws and rules that are applicable in the case of Indians selling properties are applicable in case of an NRI too. The sales proceeds from India property can be invested by an NRI in residential property outside the country for saving capital gain tax. Taxes shall be saved only if the newly purchased property is registered in the person’s name who receives capital gain. In case the property sold was jointly owned, then the new property must be jointly owned too.
The assesse shall also be permitted deduction for the stamp duty and registration charges payment from the amount of capital gain. Also, the interest paid for such property can be deducted from the amount of capital gain (in case the deduction has not been accounted for under any other law provisions.)
Lastly, expenses incurred for the property’s renovation shall also be accounted for as deductible. Therefore, the net amount gained shall be added to the earning.