Housing Rentals or Renting Commercial Space in India

Real Estate overall is becoming unaffordable for a common man in Mumbai and a lot of property buyers who cannot find their dream home even in the stretched budgets are still confused where and what to buy or stay put in there present properties. With a lot of these new projects getting ready the depressed buyers will have some respite or an option to get into their dream home temporarily on what in Mumbai is popularly known as “Leave and License” basis or in simple words “stay in a rented apartment”.

The past 2 years have been significant years for an average property buyer and he or she will surely remember them for long as these years have given him the maximum returns in terms of Capital Appreciation and Rental Returns now. The City which they say, “it never sleeps” this year itself will have close to 600 new buildings and complexes ready for possession all across Mumbai, Thane and Navi Mumbai. These are complexes and individual building blocks loaded with swank amenities, gardens, swimming pools, gyms, play areas and owned by HNI’s, NRI’s and Investors.

A lot of these projects are located in prime locations across the city and these will also cater to the growing demand in this booming economy by Corporate, Multinationals, Executives, or Corporate Employees looking to lease property for themselves and Expatriates relocating to Mumbai. The property laws have become quiet simple and secure for home owners leasing their apartments and hence there is a confidence to lease out their properties is pretty much in place.

A lot of people may still believe that leasing is like money down the drain, it is correct to an extent, but the main aspect here is that if you have long term plans to be in Mumbai or you are particular about your requirement and choice then you can go in for an outright purchase if you can afford, but if you are here for a short term say 1 to 3 years and do not want to get into a big commitment then it is better to lease out and plan your next move once you are settled comfortably in the leased accommodation.

This rent vs. buy calculation should make you understand the reasons why renting a property is better, as the financial pendulum tilts more towards leasing for sure today, as if you look at the returns your property fetches in average and upcoming location is around 4 to 6% and in prime locations with high end apartments it can go upwards of 7% depending on a lot of factors. One has to be content with this as the appreciation in the real estate compensates you more than any thing. If you look at the perspective of an individual who is doing a rent vs. buy calculation then he is paying Interest Rate @9.5 to 10% per annum for a new home loan as well in any case so he finds easier to rent a property then buy one.

The trend now shows that more and more people like to have better quality and lifestyle living and they are willing to travel if need be and hence more and more suburban areas with basic infrastructure and new developments are getting popular.

(Source: india-news.in)