Affordable Housing in Bangalore!

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    Affordable Housing in Bangalore!

    The Information mentioned here was last updated on:

    6/7/2024

    Affordable Housing in Bangalore is of utmost importance to the Builders in the coming days as there are numerous migrants from different states coming down to the city for making their living. This is creating a lot of demand for affordable housing in the real estate sector.

      

    All the Tier-A builders in the market these days themselves are focused on building top-notch houses that even the middle-class people can consider purchasing! Although, it isn’t an easy task to give all the luxury features in a budgeted condo... The builders have taken it upon themselves as a challenge to accomplish it! 

     

    There are new people coming into Bangalore every day and after working for just a year look forward to buying an apartment for their own safe haven. These days everybody who once had a good cash savings prefers to go ahead and make an investment in the real estate field. Now, this is becoming possible even for the Middle-class families whose incomes are extremely reasonable. 

      

    Let’s consider an example... Mr. Arnab has an income of 60,000/- a month and lives with his parents and wife and also a Kid. He has been working for about 6 years now and has never made an investment in Real estate before... But is thinking about it now as he has a good cash savings and has to give a safe and secure environment to his family! So, having a budget of 60 lacs starts his hunt for buying a house! He finally comes across a property called Brigade El dorado. Where... A 3BHK costs him about 45 lacs that is without calculating the registration costs and 5%GST! He then approaches them and finds out he is eligible for another deduction of 2.67 lacs under the PMAY scheme. Keeping in mind that the Brigade El Dorado is a magnificent project that has ALL Top-Notch facilities you can think of! For him getting a house that gives you all of this at a mere 42 lacs is like a dream come true! These Big projects have helped individuals actually get out their money’s worth! 

     

    Previously, in the market... At this rate you had the option of buying a property only with local builders! Also, there are only a limited amount of local builders who actually give quality apartments the rest of them are just mainly PROFIT ORIENTED. 

     

    A few apartments that even the folks from the middle class can purchase are: 

    1.     SHRIRAM 107 at 28 lacs*

    2.     Godrej 24 at 37 lacs*

    3.     Assetz Here and Now at 34 lacs*

    4.     Orchid Piccadilly at 52 lacs*

    5.     SHRIRAM Dil chahta hai dobara at 24 lacs*. 

    There are many other properties as well that offer a brilliant price with unreal amenities with an apartment that is worth going through! As we know, millennials are the new face of Indian realty. Quality houses that are sensibly priced, have over the years gained prominence amongst them. This is up to the extent that the generation is looking forward to fulfilling their aspirations of purchasing a home sooner than expected. Compact yet quality living is one of the recent trends that is widely accepted by the first-time homebuyers. The demand for affordable residential units, is in turn, driving the growth of this particular segment.

    As per an industry report, affordable housing has witnessed a growth of 22 percent in the sales velocity during 2018. Unfortunately, the supply is not at par with the demand existing in this segment. The term ‘affordable’ as a buzzword is not even in line with the Government’s definition of affordable housing. However, the residential markets such as Bangalore, Chennai, Pune, Hyderabad and Kolkata have witnessed an exponential growth, which is only corroborated by a recent report which states that people’s propensity to spend on housing is likely to improve over the next three years across the cities. The Budget announcement towards the affordable housing segment gave a ray of hope to those who were dreaming to own homes post the reduction in GST rates. The escalating demand for chic and affordable housing is expanding and is expected to impact the overall sales in the residential market.

    Post the introduction of several regulations, the realty sector has now become more organised and transparent. As a result, the homebuyers have started trusting the players in the market. Affordable segment has successfully garnered attention from the homebuyers and will further drive growth in the residential market. The current governmental reforms with regards to real estate and the initiatives towards providing housing to all will also provide a boost to the realty sector on a large scale.

    India has seen a rise in the affordable housing sector, which over the previous 3-4 years has dominated the residential segment. In the past five years, the average size of apartments in most large cities has decreased. Realtors target a large segment of buyers, particularly millennials who prefer affordable homes in well-connected areas over large apartments in distant areas. The millennials inclination towards buying a home is also driven by the Pradhan Mantri Awas Yojana (PMAY) scheme and due to fewer liabilities on the home buyers. Developers also have been venturing into the segment because of the demand surge and to avail income tax exemption by the government under PMAY scheme.  

    Bangalore we all know is the 5th largest city of our country with a population of 9milllion + it is preferred as one of the best-sought places for investment destinations. Popularly known as Silicon Valley the city has witnessed the fastest growing pattern in some years. The crown fetches one more feather of being an IT Hub of India it is a metropolitan city which is experiencing a robust of real estate development and trends. People who are an investor and who want to invest in real estate always want to be updated and keep finding the new developing and current market trends in the areas. Being such a metropolitan city, the job market has also developed tremendously. The city has premier educational institutes, hospitals, shopping malls, and many other infrastructural amenities. If we talk specifically about the realty sector Bangalore is dominated by residential and commercial projects both. The demand for 2BHK, 3BHK, penthouses and villas is high whereas affordable housing which has equipped the market right now has added the value to living. The biggies of real estate are coming up with highly advanced projects which are providing the buyers with more and more options.

    Real estate investment has long been heralded as a reliable avenue for building wealth. Unlike the erratic nature of the stock market, real estate offers a tangible asset that appreciates over time and generates steady income. But what exactly makes real estate such a lucrative investment? Let’s dive into the various facets of return on real estate investment (ROI), its benefits, potential pitfalls, and strategies for maximizing your returns. What is ROI in Real Estate? Return on investment (ROI) in real estate is a metric used to evaluate the profitability of an investment. It’s calculated by dividing the net profit by the total cost of the investment, then expressing it as a percentage. In real estate, ROI typically manifests in two main forms: capital appreciation and rental income. Capital Appreciation Capital appreciation refers to the increase in a property’s value over time. Several factors can influence this appreciation, including: Location: Properties in desirable locations tend to appreciate faster. Market Demand: High demand for real estate can drive up property values. Economic Conditions: A strong economy generally boosts real estate values. Property Improvements: Enhancements and renovations can significantly increase a property’s market value. Rental Income Rental income is the revenue generated from leasing a property to tenants. This income stream is particularly attractive for several reasons: Steady Cash Flow: Regular rental payments provide a consistent income. Mortgage Coverage: Rental income can help cover mortgage payments, easing the financial burden. Passive Income: Over time, rental properties can become a source of passive income, especially if managed by a property management company. The Benefits of Investing in Real Estate 1. Tangible Asset: Unlike stocks and bonds, real estate is a physical asset that you can see and touch. This tangibility offers a sense of security and stability. 2. Leverage: Real estate allows investors to use borrowed capital (mortgages) to purchase properties. This means you can control a large asset with a relatively small initial investment. 3. Tax Benefits: There are numerous tax advantages for real estate investors, including deductions for mortgage interest, property taxes, operating expenses, and depreciation. 4. Inflation Hedge: Real estate values and rental income often increase with inflation, providing a safeguard against the eroding value of money. Potential Risks of Real Estate Investment While real estate can be lucrative, it’s not without risks. Here are some potential pitfalls to be aware of: 1. Market Volatility: Although generally less volatile than stocks, real estate markets can still fluctuate based on economic conditions and market trends. 2. Property Management: Managing rental properties can be timeconsuming and challenging, especially if you have difficult tenants or maintenance issues. 3. Liquidity: Real estate is not a liquid asset. It can take time to sell a property and convert it into cash, especially in a slow market. 4. Upfront Costs: The initial costs of buying real estate, including down payments, closing costs, and renovations, can be substantial. Strategies to Maximize Your ROI To maximize your ROI in real estate, consider the following strategies: 1. Location, Location, Location: Invest in properties in desirable locations with strong growth potential. Research local market trends and economic forecasts. 2. Buy Low, Sell High: Look for undervalued properties or those in need of renovation. Improving a property can significantly boost its value and rental income. 3. Diversify Your Portfolio: Don’t put all your eggs in one basket. Diversify your real estate investments across different property types and locations. 4. Leverage Wisely: Use financing to your advantage, but avoid overleveraging. Ensure you can comfortably cover mortgage payments and other expenses. 5. Professional Management: Consider hiring a property management company to handle daytoday operations, tenant relations, and maintenance issues. This can save you time and stress while ensuring your property is wellmaintained. 6. Stay Informed: Keep up with market trends, economic indicators, and changes in real estate laws and regulations. Being informed allows you to make strategic decisions and adapt to market changes. Personal Insights and Conclusion Investing in real estate has been a cornerstone of my wealthbuilding strategy for years. The combination of capital appreciation and rental income has provided me with a stable and growing source of revenue. While it’s not without challenges, the benefits far outweigh the risks when approached with careful planning and due diligence. Real estate investment requires a commitment of time, money, and effort, but the potential rewards make it worthwhile. Whether you’re looking to diversify your investment portfolio, generate passive income, or build longterm wealth, real estate offers numerous opportunities. Remember, the views expressed in this blog are solely my own. As with any investment, it’s crucial to do your own research and consult with financial advisors to tailor your strategy to your unique circumstances. By understanding the nuances of ROI in real estate and implementing smart investment strategies, you can navigate the market effectively and achieve your financial goals. Happy investing!