Time To Invest In Indian Real Estate

There’s a famous saying by one of the world’s most opportunistic investors. A man named Baron Rothschild always advised that “The Best Time to Buy Is When There’s Blood on the Streets”. In today’s economic scenario that saying could not have been truer. If you’re an investor who is willing to put your money in the stock markets and wait for a while then chances are that your wait will be rewarded with excellent returns once the economy gets back on track. One sector you might be interested in investing is the Indian Realty and Real Estate Sector.

The Real Estate sector is one sector that is indicative of the economic situation of the country. We know that all economies move in cycles. There are Booms when the economy and the stock markets are flooded with money. People are optimistic and growth takes place. What we are now seeing is the exact opposite of that called the Recession where people are afraid to invest in the markets and start saving money.

Those already invested are removing their money out of the markets in order to cut their losses and that’s the reason why the Sensex is hitting a new low everyday.

So if you are interested in investing in the Indian growth story via the equity or share market; this is your chance. One must remember that this scenario has been applied to the long term investor-a person who is willing to stay invested for a long time. In the case of the Real Estate sector this could well be worth a wait of 2-4 years, maybe even more.

But if you’re willing to do that then you should be rewarded because the Indian economy despite a recessionary trend is expected to grow at 7% this year alone.

The Sensex crashed today by 700 points and has been falling for quite some time. The biggest losers in this bear run have been the Real Estate sector and the Banking sector. Incidentally these were the same sectors which were doing well when the Sensex was booming last year. Indian Real Estate companies have become heavily undervalued and their shares are being sold in the market for prices which you will not see for a long while.

While investing in Indian Real Estate companies always bear in mind:

·         That you have enough information about the company.

·         Make sure that their order books are full of projects which will keep their revenues coming in even if they don’t get newer projects along the way for some time due to the current economic crisis.

·         Make sure that they have good financial backers and are supplied with credit for at least some time to finish their projects.

·         Take a look at their revenue and check if they’re growing and that they haven’t stagnated.

·         Their top brass and management are competent enough to see them through these times.

If however you have the cash at hand and don’t want to take the risk of investing in equity you may even want to invest in land directly. Real Estate prices across India have come down so a piece of land or an apartment you can sell later for a higher price isn’t a bad idea.

[Disclaimer: Investing in stock markets involves a person taking a considerable amount of risk. The above article is only of an advisory nature.Statements related to companies and businesses have been made on past performances and do not necessarily indicate their future behavior because economies and markets are of an uncertain nature. Neither the writer nor the site can be held responsible for any action(s) of the reader based on this article.]