Property ownership in India can be heaven or hell – the kind of tenants you get are key
The principles of good property management are not rocket science. But ensuring that reality matches expectations is where many property management companies falter. India has a booming economy and is one of the most attractive investment markets in the world today. And in no industry is that more true that the real estate industry. More and more Non Resident Indians (NRIs) are investing in India and are being amply rewarded for their investment in the form of rapidly increasing property prices.
Even the depressed economic climate in the last few years has done little to dampen the enthusiasm of the real estate market in India. While growth may have slowed down, no Indian city has had to face dramatically falling property prices like in so many other parts of the world. But what do NRI investors do with their Indian properties? The most typical answer to this question is that they leave it locked up.
Amisha*, who owns a flat in a well-to-do suburb of Mumbai, told me, “I have a flat in India but I would rather leave it empty than take a risk and letting it out. I have heard that tenants in India can be unreliable. They can take your flat and refuse to pay rent. Or they can refuse to vacate my flat when I need it. I don’t want to give my flat to people and then find that I can’t get it back. How can I find reliable tenants who will pay my rent on time, not create problems and vacate the flat when I need it?”
The key to success in the Indian property market starts at the beginning with reliable tenants. But how can NRIs who are based out of India check the background of potential tenants? The answer is to find a good property management company in India. And if that company has offices in the NRI’s city as well, then that’s even better. A property management company in India can resolve the problems NRIs face when they are dealing with property in India.
Good property management companies evaluate prospective tenants for your property using a thorough vetting process. For the Indian real estate market, the checklist for prospective tenants includes:
- Those with steady jobs in professional companies are preferred
- Bank statements or pay slips for at least six months
- Proof of identity such as a passport, driving license or voter identity card.
- Letter of recommendation from an employer
It is also important to find a property management company that understands the local property market and their cultural sensitivities. Indians have several preferences and prejudices when it comes to their home and it takes a great deal of understanding to navigate all of them.
For example, only a local agent can tell you that Diwali is the biggest festival in India and people buy houses during Diwali and complete renovations before that, but no one moves house during Diwali. Getting a local expert who understands the Indian market makes sure that you’re getting the right advice at any point in time.
The Indian real estate market can be a mine field or a gold mine depending on how you approach it and who you work with. Talking to the right people in India can make your property ownership experience a joyful experience.
Want to know more about the Indian real estate market ? Unesta is a property services firm, with offices in London and Mumbai, offering letting, sales and property management services to NRIs owning property in India. www.unesta.com / +44 207 125 0425.