Value for money in real estate investments. Are you invested in the right one?

"One of the common mistakes we see investors making is going for the builders brand alone and not considering other features like locality, quality of construction and connectivity in choosing projects.", says K Ramachandran our CEO.

How do we define value for money? One can easily calculate time value of money by accounting for future rates of interest. However when choosing a project or a builder, brand should not be the only parameter and the normal Pv calculations do not apply.

The projects we associate with have the best value for money in term of return on investment. Some times we see investors getting locked into projects based on builders brand repute. However they make a blatant mistake of not evaluating connectivity, location and other parameters which can cause a 30% difference in resale value in around 3 to 5 years.

For e.g. take the case of 2 developers one, whose project took 3 years to complete ( a bigger brand) and another which took just 1.5 years (smaller brand). Some times the location and speed of construction can be such a positive factor that 40 Lakhs invested in former project could value it at 55 Lakhs in 4 years while it could be well over 60 Lakhs in the latter one.

Hence investors should carefully consider various factors in making sure you get the maximum value for money on your real estate investments

Low land availability and high demand sending realty prices in Trivandrum soaring

While Kochi may be the real estate hub of Kerala and commands a major volume of business, Thirvuananthapuram, the capital city has seen some action over the past few years. Unlike Kochi where there has been a saturation in the recent past, Thiruvanthapuram is a growing market with a steady growth of 15% annually.

According to SN Raghuchandran Nair , MD of SI Properties "Realty business in Trivandrum has clocked a cumulative growth of around 50 to 60% over the last five years" ."Growth here is on the back of need based buying and not speculation driven as in other markets. So market has shown a steady growth", as per K Srikanth, MD of Skyline Foundations.

As per our research, NRI consumption has now given way to domestic consumption which was just the opposite a few years ago. Today the realty market is in high demand due to smallish nature of the city with just about 5 square kilometer in radius. This means an increase in the number of high rises and also high end properties which have a 1cr+ price tag but also offer great amenities and imported fittings.

As per statistics available, next ten years will see huge appreciation in reality in Trivandrum, so this is the time and destination to invest in. Major infrastructure projects like Vizhinjam port and monorail and other developments like Technocity and Biotechnology park which will generate huge employment opportunities are all set to boost prospects for real estate appreciation in and around the city. Residential rentals in prime areas could go in the range of 25000+ in prime areas which is more than what an investment in Kochi would give.