Jabong Mailer (CPA)

Monday, 14 December 2015

When can you make money in real estate? You probably can if you buy really low, strike a bargain and get a great deal, or if you are lucky with an investment you never thought would really show double-digit appreciation (for this, you need to have already made the purchase at a price that seems like a real bargain in retrospect).

Bargain buys
A recent JLL report quotes an official saying that project sales are typically spread out at 18 per cent at the time of launch, 55 per cent during construction and 27 per cent on project completion.

It is usually the 18 per cent who make the real killing. But normally, retail buyers looking for a home to live in find investing in such projects premature, given the long delivery timelines.

Builders usually sell a significant portion of the property to early investors to bring in cash early to fund the project construction. Such sales are often at huge discounts with these investors looking to cash in on a resale usually at the pre-launch stage.

With the current slowdown in the real estate market, the need for cash may prompt a few early bird investors to sell at a slight discount to the prevailing prices, opening the doors for retail buyers to seek bargain buys.

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