To make real estate investments in 2014, begin research in 2013

Property investment, by far, is still one of the most calculated approaches, since it crops higher returns. Every year, by the end of December and with the onset of January, investors conduct a brief research on the best performing markets of the present year to determine the most apt region for investment in the next tenure.

Analysis of the property market in the last few years puts up the fact that the cost of construction has hit the ceiling. Cost of cement, sand, labour and steel have elevated consistently in the last few years. Before giving a nod to a particular region for property investment, prospective home buyers need to take into consideration such aspects and take decision.

Escalating cost

Adding to the woes of the developers is the cost of finance, which has been rising up consistently. This has further escalated the construction cost uniformly. Irrespective of benign market conditions and demand, developers and builders face a tough time to stabilize the prices. According to property consultants, in addition to the resulting demand-supply equations and the prevailing economic scenario, a number of other aspects contribute significantly towards the consistent rise in property rates.

Rise in commodity prices (mainly the construction materials) is directly proportional to the exchange rate. A sharp fall in the rupee value invariably led to hike in prices of construction materials. According to financial analysts, further depreciation of rupee against the dollar will run up the cost of construction materials, again.

Rising demand

Another significant component of property pricing is the rising demand. Over the years, Bangalore has witnessed a huge influx of IT/ITes professionals, accountable for the rise in demand for residential property. With the beefing up of the connectivity from the suburbs to the city, demand for affordable housing units has received a significant boost. Experts suggest that demand in this segment will rise at a steady pace, given the augmented connectivity and rise of commercial developments in the suburbs.

For potential homebuyers, December is the ideal time to plan for a new home the following year. The planning should take-off by deciding the location and the type of property that suits the buyer. Furthermore, an out-and-out analysis of the budget is a mandate. As per property consultants, the first three months of a year are the perfect time for a buyer to make a headway for property transactions.