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Why invest in
property ?
"90% of all
millionaires become so by owning property"
ANDREW CARNEGIE
It is no shock that over
half of the people on 'The Times Rich
list' have made their money via
property.
A house acquired for
approximately �5000 in the
1970's would be worth approximately �250,000 today, an increase
of almost 5000%.
In certain locations, in
India apartments and commercial properties have
doubled in value over the last 1 year alone.
On average a property
doubles in value every 4 - 7 years.
All the above are just a few examples of why
property has been the most consistent investment
over the last 20 - 30 years.
Supply &
Demand
The main reason for the
constant increase in property values can be
explained by using basic economics. If the
demand for a commodity exceeds the supply, the
price will always rise. Population growth
compared to the lack of new houses available
continues to generate price increases.
Leverage and the use of
OPM (Other People's Money)
One of the reasons why
more people are now investing in property than
ever before is the increased availability of
finance (mortgages).
If you were to acquire �100,000
worth of shares, it would cost you personally �100,000
. If you wanted to acquire a �100,000
investment property, you could generally borrow
at least 80% (�80,000) and therefore only need to fund 20% of the acquisition
personally (�20,000)
.
A Quick comparison
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�100,000
Property
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�100,000
of Shares
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Amount required to purchase the asset
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�20,000
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�100,000
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If the asset grew in value by 20%, the gain
would be
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�20,000
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�20,000
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Return on Investment
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100%
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20%
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Therefore, your investment
has risen by 5 times more by investing in
property than in shares, by using leverage &
OPM (other people's money).
Risk
Also, �100,000 invested
in shares could obviously rise in value. The
decline of the dot-com industry recently
illustrated how quickly a �100,000 investment
can be reduced to nearly zero.
The probability of a �100,000
property becoming worthless is virtually zero.
There are of course peaks & troughs in the
property markets but historically, property
always rises in value over the medium-long term.
Options
The
other major advantage of Property is the options
you have as an investor. If you want to make a
'quick profit' you can Buy to Sell (also
known as buy to turn, or Flipping), whereby you
merely sell the property on as quickly as
possible. Alternatively you can Buy to let,
whereby you keep the property and it generates a
regular income for you. See other sections of
this website for further details on Flipping.
Why invest in
INDIA ?
The
circumstances of the Indian economy are
different. India at present is a poor nation,
and there is a huge room for growth and
appreciation of property prices. India property
prices are on fire. Property is appreciating by
30 - 50% every year. There have been instances
of 100% appreciation per year. We believe the
factors behind this growth is the huge Indian
population. Population is
the main driver of property prices. And India
has population. Delhi's population is increasing
by 1 million every year. Because the
industry and jobs are there. And as the needs,
desires, requirements and earning capacity of
the masses increases so does the property
prices. This will continue probably for the next
50 years until the Indian earning capacity and
economy comes to par with the rest of
the world. On top of all this,
the Delhi condo hotel prices are going up
by $120 per day. All this is good news to
the buyer.
The Attraction
* Property prices 50% less than than USA or Europe.
* Low
cost of living
* Developing
Nation
* High
Growth.
* Huge
Population
* 10
year build guarantee (similar to NHBC)
* English
widely spoken
* Big
Commercial Cities
* Excellent
Invest Returns
* Enjoy
a luxury lifestyle for very little
It's Financial
Benefits
India offers additional
benefits from a financial standpoint which makes
it a highly attractive prospect for purchasers:
* Low property taxes
* Safe
investment - Notary supervised property
registration similar to France & Spain
* Easy
repatriation of investment should you re-sell in
the future
* Only
20% tax on any capital gains
* Property
market booming - average rises of 30 - 50% per
year achievable
* Rental
occupancy reaching 85 - 95% most years
* 70
- 80% mortgages available
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