Building Riches in 2020

REAL ESTATE INVESTMENT CAN TAKE YEARS TO BEAR FRUIT. HERE IS HOW YOU CAN TWEAK YOUR APPROACH TO MAKE THE MOST OUT OF IT

- ASHWINI KUMAR SHARMA

REAL ESTATE BASICS

Real estate has delivered good returns in the long run

Residential real estate sees abrupt growth cycles

commercial real estate offers higher rental yield but one needs deep pockets for investing

REITS give investors the option of making small-ticket investments in the sector

When it comes to building assets, especially in India, real estate attracts a large section of investors. The reason is that, unlike a financial asset, it is something investors can see, touch and feel. That is why almost three-fourth of Indian household wealth is parked in real estate and only a small fraction in financial assets. “The average household holds 77 per cent of its total assets in real estate (which includes residential buildings, buildings for farm and non-farm activities, constructions such as recreational facilities, and rural and urban land) compared to 5 per cent in financial assets (such as deposits/savings accounts, publicly traded shares, mutual funds, life insurance and retirement accounts),” says a 2017 report by the Reserve Bank of India titled “Indian Household Finance Survey.”