Owning Property in India: A Self Obsessed Syndrome

The two most discussed words in Indian society are “politics” and “property”, both starting with alphabet ‘P’ being a coincidence. The word Property in India ushers in a whole lot of thoughts and emotions and anybody and everybody is an expert on this subject.  Irrespective of the background of a person, property is one subject in India on which everybody has an opinion and set of advises, one only has to raise the topic. The reason for this is simple, property is one issue which is discussed in all households and families’ year over years; generation after generation; from poor to the middle class and ultra-rich; across religions and society barriers. We as a society are obsessed with property because of our insecurities and uncertainties.  Such is the obsession that you talk of investment and the first option thrown at you is property, despite the fact that it is the most difficult to execute. Let’s look at the pros & cons, as also the reasons for this irresistible passion towards property in India.

There is little doubt that property in India remains the safest investments of all and 99% of the time will not fail you as investor, in the long run. Of course it needs to be done judiciously after having weighed-in all factors. The keyword here is ‘in the long run’, what it implies is that property investment generally should be treated as a long term investment, rather than as a tool for early and quick financial returns.

Property investments are long drawn in terms of the decision making cycle as well as the implementation stage. Accordingly, the liquidation stage also requires patience, perseverance and is generally a time consuming process. This implies that the investments remain frozen for longish time periods with minimal flexibility for liquidity and therefore cannot be relied upon in case of emergencies.

As a family unit or individual one needs to decide the quantum and number of such investments, as managing the property portfolio is time consuming as well as complicated. 

Property investments are also subject to natural calamity risks like floods, hurricanes, earthquakes etc., to an extent that it can lead to loss of the entire investment, which in case of property is substantial.

Owning India property psychologically boosts your social security factor and like any other branded ownership also defines your status; Therefore, till the time as a family or individual you own one, it keeps playing on your mind. It is advisable to initiate investment in property at the earliest and as soon as one steps into a professional career. It leads to forced savings and also provides the longest duration for loan repayments, thus easing out the instalment premiums.

Owning property is definitely one of the important components of an investment portfolio for any individual, however it should not be the only one. One also needs to guard against over-obsession for property ownership, which comes naturally to us Indians.