Akshaya Tritiya: Five important factors to consider when investing in real estate

Akshaya Tritiya, traditionally a festival of prosperity and success, is becoming a day for strategic investments, particularly in real estate. Fractional ownership of commercial properties is becoming increasingly popular, providing investors with accessibility, diversification, and higher returns. 

We, as Indians, value our traditions and cultural beliefs and find meaning in the rituals that shape our lives. The auspicious festival of Akshaya Tritiya, which falls on the third day of the Hindu month of Vaishakha, sends a sacred message of prosperity and success. As a result, buying gold on this day is expected to yield good long-term returns. Traditionally associated with gold purchases, this festival has become a day for foresightful investments. 

Initially, people turned to gold for financial gain, moving from physical holdings to gold ETFs and bonds. Real estate is currently undergoing a similar transformation. Fractional ownership of commercial real estate is increasingly becoming the preferred option, rather than traditional home purchases. This shift heralds a new era of investment strategies, with the advantages of fractional ownership— accessibility, diversification, and the potential for higher returns— attracting increased investor interest.  

As we honor tradition while embracing innovation, Akshaya Tritiya is recognized as a symbol of progress and an auspicious day to invest in a better future. Here are some things to consider when investing in real estate. 

Residential vs. Commercial Properties 

One of the first decisions investors must make is whether to invest in residential or commercial properties. Residential properties appeal to both homeowners and investors seeking rental income. However, residential properties may present difficulties in tenant management and offer lower rental yields than commercial properties. 

According to a recent industry report, housing prices have risen by 13 to 33 percent in seven major cities over the last three years, while commercial real estate markets have seen a 15 percent increase during the same period.  

Commercial properties, such as grade A office spaces, provide good rental yields of 8-9 percent, compared to 2-3 percent for residential properties. This enables investors to benefit from verified tenants while avoiding certain risks associated with residential properties. 

Opportunities for fractional ownership. 

As we know, Akshaya Tritiya is important for long-term real estate investments. This day seems ideal for purchasing valuable items with the expectation that they will bring prosperity and fortune.  Moreover, India’s real estate investment landscape is evolving similarly to a “mutual fund” moment, with regulators supporting fractional ownership. 

SEBI’s regulatory support for REITs, including establishing standards for Small and Medium REITs (SM REITs), marks a watershed momentum for investors, bolstering their confidence even further. These developments make real estate investment more accessible by allowing retail investors to participate in high-value properties through fractional ownership. With a lower minimum investment threshold of INR 10 lakhs, real estate investment becomes more accessible, aligning with the festival’s theme of prosperity and abundance. 

Benefits of investing through fractional ownership. 

Fractional real estate ownership offers investors several benefits, including regular income, asset security, liquidity, tax breaks, and ease of possession. This is an excellent choice for investors seeking both income and capital appreciation. 

Navigating the regulatory and legal frameworks 

Real estate transactions involve intricate regulatory and legal frameworks that differ depending on the location and type of property. Investors must follow all legal requirements and perform due diligence to ensure the authenticity of property titles, approvals, and ownership records. Seeking professional help from legal experts or real estate advisors can help investors navigate these complexities more easily.  

Tracking long-term growth potential

While short-term gains may be appealing, investors should focus on long-term growth potential when investing in real estate. Assessing infrastructure development, urbanization trends, and demand-supply dynamics can shed light on the property’s future appreciation potential. Investing in emerging markets or growth corridors with strong economic fundamentals can generate significant long-term returns. 

In conclusion, investing in real estate during Akshaya Tritiya is an appealing opportunity for those looking to increase their wealth and secure their financial future. Using these measures, investors can make informed decisions and take advantage of the favorable timing of this opportunity to embark on a successful real estate investment journey. 

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