Are Festival Real Estate Deals Worthy Of Your Pursuit?

With Diwali around the corner, the real estate festive offers are in their full swing. Many real estate developers have put attractive offers on the anvil to charm home buyers. The recent rate cut by the Reserve Bank of India has of course helped in reigniting consumer interest in the real estate. 

Among the freebies offered by the developers, EMI subvention scheme is amassing the highest interest from home buyers. An array of payment options like 10:80:10 or 5:95 or no EMI till possession are rolled out to woo buyers. Apart from these, there are several other catchy offers such as foreign trips, gold and exemption from stamp duty or club charges. While such schemes have generated results for real estate developers in the past, it’s time to evaluate if these schemes are the only criteria for home buyers. 

Market Dynamics

India Ratings and Research recently published a report, highlighting that the real estate inventory is currently equivalent to three years of revenue. Although only a few projects have launched, still the inventory numbers are nothing but eyebrow raising. This means that the market forces is currently inclined towards home buyers as most of the real estate developers are struggling to offload inventories that have been going up for the past few years. Resultantly, prices have eased off, thereby, putting pressure on developers to finish their ongoing projects sooner. 

In view of the given scenario, many real estate experts contend that the stagnancy in the sector will extend for some more time. There has been no remarkable rise in real estate prices so far and the scenario is not likely to change in the coming months. This implies that festive season is not the only time when home buyers can hunt for a deal, rather they will have a reasonable time to decide about their purchase. 

Draw a line between real and superfluous benefits

First and foremost, the home or real estate in question should meet your requirement, only after which anything comes into the picture. Schemes like a gold coin or car or even a foreign trip will work if the piece of real estate really suits your need. Even if offers do matter to you then try choosing the ones that can really provide measurable financial benefit to you. For instance, free car parking, registration fee exemption or waiver of stamp duty translate into quantitative financial benefits.

End-goal

At last, offers or freebies should not alter your end objective behind buying real estate. To make a prudent decision, market scenario (as explained earlier) precedes everything else. In short, the current scenario favours home buyers, who are looking to buy it for themselves. 

But, if the purpose is solely for investment then be mindful as it might mean locking up your capital for an extended period of time. Also, ready-to-move-in projects should be given priority over in-progress projects as delay in completion continues to be a challenge in the sector and can hurt buyers at the end. 

About The Author: Reenika Avasthi is associated with Inverika Investment Solutions LLP as a Content Writer and Financial Planner. She is a Certified Financial Planner and a freelance content writer in the field of personal finance. Her interest in writing and spreading investor awareness motivated her to start blogging.

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Five Smart Options To Deploy Your Tax Refund

Those who have filed their taxes on time would have mostly received their tax refunds by now. With festivals around the corner, it would be only natural that this excess money could either be lying idle in your bank account or be spent away in leisure activities. 

This piece will explore some smart options that could help your money to make a difference by putting tax refund to a better use. 

1. Repay high-interest debt - Tax refund can be effectively used to discard bad debt such as credit card, personal loan or car loan. Repayment of debt should be primarily done on the basis of interest rate, which means that loans with highest interest rate should be repaid first, followed by others. (Sequential order of loan repayment has already been outlined in our earlier blog).
2. Boost you business funds - If debt is not a concern for you at the moment, but it is the new business venture that is occupying your thoughts then tax refund could prove to be a great way to build business funds. It is prudent to divert your tax refund money towards business opportunities. Although such diversions might not be big enough for your business but it will at least lessen the gap by some margin.
3. Big plus for retirement - Apart from repaying debt and business funds, tax refunds can also become an effective tool to bolster your r
   etirement savings. Money received in your account can immediately be transferred to funds that are meant for your retirement. By utilising tax refund towards retirement, you can reach your goal not only sooner, but it will also grow at an incredible pace to leave you with substantial savings than intended.
4. Prepare better for emergencies - It is common that emergency corpus gets used up in fulfilling meagre or urgent things. Those requirements might not be urgent in nature but the ease of accessibility to emergency funds lead to its erosion over a period of time. During such times, income tax refunds could come handy to make good of the shortfall to your emergency corpus. 
5. For an extra mortgage payment - It is possible that your income tax refund could be too meagre to be used towards the afore listed goals. In such a case, it is recommended to pre-pay one or more of your mortgage payments, which will directly bring down your principal outstanding amount. Such small measures, when implemented every year could help bring about a visible decrease in the interest outgo and tenure of your mortgage loan. 

Lastly, do not forget to reward yourself by spending a part of your tax refund towards leisure activities. But take care that you do not overdo it and keep such expenses restricted to a set percentage of your tax refund.

About The Author: Reenika Avasthi is associated with Inverika Investment Solutions LLP as a Content Writer and Financial Planner. She is a Certified Financial Planner and a freelance content writer in the field of personal finance. Her interest in writing and spreading investor awareness motivated her to start blogging.

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How You Can Grow Your Bank Balances Bigger By Acting Now?

“Anything in excess is bad”, which is equally true in case of investments, where investors are experiencing information overload, drawing them back to make any decision at all. The biggest example of an inadvertent reaction to such information overload is letting cash sit idle in savings account. (We have already discussed the alternatives to savings and current account in our earlier post.) 

Creating investment awareness is critical, but the question that confronts us is how to fix excessive awareness that more or less works in a similar way as lack of it. Too many investment alternatives hold back even notable professionals from taking a call. At times, bad investment choices made in the past also haunt investors judgement, forcing them to procrastinate investment decisions. 

Be it too much of information, lack of time or impact of the previous decision, it is your own money that is on the losing end due to the unstoppable and irreversible function of inflation. 

If such is the case then it’s high time to come out of this inactivity and make informed decisions. Few pointers that will help you through the process are briefed here. 

1. Time to shun investment inertia - Nothing can be achieved by doing nothing, which means that letting cash sit idle in bank account just because you are not finding time is not going to take you anywhere. Rather than finding time, it is important to ‘make time’ for it and start planning. For this, you can assign an hour out from your weekly leisure time towards impending investment decisions. Set a deadline for yourself and put your surplus funds to work before it’s too late. 
2. Simplifying investment decisions - Beating inflation should be the heart of your investment decision, which implies that you do not have to get into complex financial planning to treat your surplus funds. Reviewing best of the alternatives that have a track record of better performance should be the right choice for you while the comprehensive goal planning can be done at a later stage. 
3. Annual Plan - To avoid investment inactivity during the busier times of the year, it is recommended to get an annual plan in place right at the start of a year. An annual plan will make it easier to divert surplus funds into pre-decided investment avenues. For this, investors can either seek help from a financial advisor or could simply choose the basket of products that will match risk appetite and performance criteria. At the same time, it is important to not let your portfolio be under or over diversified. 
4. Get into action- A plan in hand will allow you to systematically divert funds into chosen products, thereby, eliminating the need of redoing research and choosing products each time you have a surplus. 
5. Hunting down temptations - It is easy to get swayed away by a plethora of new products hitting the market each day while recommendations from friends or relatives might even prompt you to look away from your plan. To avoid such temptations, give time to proposed new product or recommendation to prove itself before impulsively acting on it. 

This line of action will help you to get going without giving in to another information overload trap. As Mark Twain said - “The secret of getting ahead is getting started.”

About The Author: Reenika Avasthi is associated with Inverika Investment Solutions LLP as a Content Writer and Financial Planner. She is a Certified Financial Planner and a freelance content writer in the field of personal finance. Her interest in writing and spreading investor awareness motivated her to start blogging.

Like us at https://www.facebook.com/Inverika/