Property market is one of the most unorganized markets, organized markets include commodity markets, retail goods market, stock markets and bond markets therefore it is extremely important to perform necessary due diligence before buying a property. Unorganized property market includes commercial real estate, residential real estate and agricultural land. The first and foremost aspect of selecting a real estate to purchase is location. A mature location or estate will have the necessary amenities like supermarkets, schools and good public transport connectivity. Before purchasing a property, a clear distinction has to be made in terms of the goal of owning property. The property can be used as an investment vehicle or for self usage. Defining this purpose would help in terms of budgeting and financing the property. If the property is considered purely as an investment property then parameters like tenant profile, rental yield, property tax and the location have to be considered. If the property is for self usage, then the availability of necessary amenities has to be considered.
Once the location is finalized the next important aspect to take note is the financing of the property. The most common financing option available for property buyers is called a mortgage loan from a financial institution like a bank or a mortgage loan company therefore it is important to have a high credit rating which helps in mortgage application. Another important aspect of financing is the total debt to service ratio, it is usually calculated as total debt as a percentage of income and it is important that this number does not cross a certain limit leaving some cash on hand for other purposes, it is important to select a property to keep the total debt to service ratio within a certain range. Opting for a variable rate mortgage is recommended in this low interest environment as the owner can take advantage of lower interest to finance the property. Every excellent architecture design firm takes the advantage of the same.
Checking out the relevant documents of the property and the credibility of the owner is part of the due diligence that needs to be performed before buying a property. Employing a credible lawyer to vet the documents is necessary before paying the option to purchase. Charting out a renovation budget is essential for careful planning and spending on the purchased property. Budgeting out these expenses gives a clear picture on the amount of money that can be spent on the property. Other expenses like legal fees, registration fees have to be taken into account while budgeting for the property. Check Showcase IDX MLS integration for more information.
Once the property is narrowed down and an option to purchase has been paid it is important to consider certain types of insurance for the property. The types of insurance offered for property are mortgage insurance which pays the mortgage when the owner is unable to pay the mortgage due to severe accidents. Fire insurance is essential to recoup the expenses in an event of fire. Other insurance like theft insurance can also be considered depending on the location of the property. The architecture design firm has all these already sorted.
If the type of property purchased is a residential plot or a new development then the credibility of the builder and the people involved have to be taken into consideration before purchasing the property, this includes taking for the approvals by local body, the list of institutions financing the development and the testimonials of the builder or the developer involved in the project. Finally, the owner has to take into account the scope of future development of the locality in which the property is situated, a growth prospect indicates a potential rise in value for the property and the amenities around the property.
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