Anuj Puri

Entering into a real estate investment without any clue about how to go about it is a dangerous thing indeed. Like any other market, real estate has its own peculiarities. Even those who are familiar with them cannot be assured of success—not unless they are very clear about the effort and resources required for the investment. Here are four pre-requisites for a successful real estate investor.

GET CONNECTED
As people have always known, there is security in numbers. Before you actually begin investing, network with others who are also on the lookout for a good deal or with those who have already bought property. Developing contacts and meeting people will enrich your repertoire of current, useful information. On your own, you could be at a distinct disadvantage of not being in sync with the market sentiment.

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FINANCIAL RESOURCES
There are innumerable major and minor expenses involved in real estate transactions— purchase cost, taxes, legal fees, travel expenses, etc. To avoid serious problems later on, you should be able to account for all incoming and outgoing sums of money at any given time. If you require capital before investing, keep in mind that financing institutions rarely sanction loans on anything but existing assets.

BE PREPARED FOR SETBACKS
The market is a fickle one, and predictions or projections do not always come true. If the property is for your own use, some minor short-term downside is only a notional loss. But you need to be more careful if the property is for investment. A piece of property that you hoped would fetch a handsome profit in the future may turn out to be a dead duck. In times of a serious market slump, the best you can hope for is to be able to make a marginal profit. Calculated risks can and should be taken, but the operative word here is ‘calculated’, not ‘impulsive’.

KEEP EMOTIONS OUT
Real estate investment often fails as a family enterprise. The reason is simple—personal feelings, requirements and loyalties get involved. This also holds true for friends who try to form a partnership in this line. They are likely to fail for the same reasons.

— Anuj Puri, Chairman & Country Head, Jones Lang LaSalle Meghraj