Guide for Gorakhpur Commercial Real Estate Investment
Gorakhpur is a city in Uttar Pradesh which is situated around the Rapti river in the Purvanchal area. It has an Indian Air Force station and is home to Gita Press, the largest publisher of Hindu religious texts.
There is a lot of development in the cards for the city; a huge budget has been reserved by the government for the betterment of the city. Therefore, it is certain that the real estate market in Gorakhpur is transforming into a magnet for property buyers.
Let us understand why investing in commercial real estate in Gorakhpur might be beneficial:
Top Reasons to Invest in Gorakhpur Real Estate
Here are some reasons why you should invest in commercial real estate in Gorakhpur:
- Good Connectivity
The road and transport facility of Gorakhpur connects the city well with other cities in the country. Great railway connectivity has transformed it into a busy junction. Allocation of ₹1000 crore for development of the Purvanchal Expressway will make the connectivity much more seamless.
- Trading Centre
Gorakhpur has huge importance in the commercial market. The city is undergoing a rapid transformation that would uplift the face of both commercial markets and real estate markets. It is the trading centre of eastern UP, Bihar and Nepal due to its wonderful infrastructure and transportation means.
Commercial Real Estate Investment Opportunities in Gorakhpur
Here are some localities in Gorakhpur that are ideal for commercial real estate investment:
It is situated in the centre of Gorakhpur. This locality has great connectivity with Gorakhpur junction railway station. There is enough space available for parking. Many luxurious hotels and showrooms make this place apt for retail investment. The rate of property here ranges around ₹16,000 per square foot.
It is a nice locality as it is situated in the core of the city and has great connectivity as it is near the airport. It is in great proximity to NH-28. It is also close to major places in the city and 400 metres from railway station. Rate of commercial property here ranges between ₹9,000 to ₹23,000 per square foot.
Things to Consider Before Buying a Commercial Property in Gorakhpur
Here are some points you should consider before opting for a commercial property in Gorakhpur:
- RERA Authentication
Before buying a property, you should check whether the property adheres to the norms of RERA. The Real Estate Regulatory Authority (RERA) is the apex body that promotes and ensures transparency and accountability in India’s real estate sector. This was formed after enactment of Real Estate Regulatory Authority Act of 2016.
All states have their own RERA platform. You can visit the website of RERA Uttar Pradesh to check whether the property and its builder are credible and authentic.
- Market Research
Before opting for a commercial property in Gorakhpur, look into the long-term price prediction of the locality. Give ample amount of time to research and understand what may help and hinder the value of your property in future.
Stamp Duty in Gorakhpur, Uttar Pradesh
Stamp duty in Gorakhpur is levied as per the circle rates decided by state administration. Here are the stamp duty rates:
|Joint buyers (Male + Female)||6.5%|
|Joint buyers (Female + Female)||6%|
|Joint buyers (Male + Male)||7%|
Registration Charges in Gorakhpur, Uttar Pradesh
For property registration in Uttar Pradesh, it is mandatory to pay registration charges levied by the state government. Here are the rates:
|Joint buyers (Male + Female)||1%|
|Joint buyers (Female + Female)||1%|
|Joint buyers (Male + Male)||1%|
Gorakhpur Commercial Real Estate Sector: What’s the Forecast?
Gorakhpur is indeed turning into a better real estate market than ever before. As many as 19 big-ticket housing, as well as commercial property projects worth a total of ₹4,344 crore, have been proposed in and around Gorakhpur. This will further attract industrial investments in the state.
An allocation of ₹250 crore has also been made for projects in Gorakhpur. These projects are expected to get commissioned in January 2025, and this will bring in employment opportunities for 400 people.
Moreover, UP Government has also allocated a budget of around ₹1,000 crore for the development of the Purvanchal Expressway, which would make travelling to Gorakhpur easy and hassle-free. This will certainly boost investment opportunities in commercial real estate sector.
Commercial Real Estate vs Other Asset Classes
Below is the comparison between commercial real estate and other asset classes:
Commercial Real Estate vs Bonds
Bonds are more secure than commercial real estate investments. However, bonds offer static returns, which are not as high as returns earned from real estate. However, bonds have high credit risk when compared to real estate investment.
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Commercial Real Estate vs Mutual Funds & Stocks
Stocks and mutual funds offer much high returns and perform better than real estate. However, there is more risk while investing in mutual funds, which is not the case in real estate.
Commercial Real Estate vs Gold
Gold investments are riskier than real estate because there’s the risk of gold getting stolen. However, commercial real estate requires a much higher quantum of investment which is not the case in gold. With real estate investment, you can earn rental income every month, which is not possible in case of gold.
Commercial Real Estate vs Residential Real Estate
Commercial real estate helps you earn much higher returns when compared to residential real estate. However, you can avail tax benefits on residential property investments if it is acquired on a home loan.
Here is a tabular representation comparing all types of assets on the basis of returns, liquidity, risk, volatility and ticket size:
|Parameters||Commercial Real Estate||Stocks & Mutual Funds||Gold||Residential Real Estate||Bonds|
Steps to Invest in Commercial Real Estate in Gorakhpur
Below are the steps that you can follow if you wish to invest in commercial real estate in Gorakhpur:
Step 1: Prepare a budget and decide the type of commercial property that you wish to invest in.
Step 2: Select a few locations as per your budget and requirements.
Step 3: Plan a field visit to each of the locations to assess them minutely. You can also take the help of CREDAI to know more about the properties and their builders.
Step 4: Once you have finalised a property, take the help of a lawyer to complete the legal formalities and documentation.
Step 5: After paying for the property, pay the applicable stamp duty and registration charges to transfer the ownership of the property to your name.
Despite its importance in the commercial market, Gorakhpur’s infrastructure was not up to the mark even a few years before. It lacked right roads, connectivity, market and transport. However, it is undergoing a major transformation that intrigues real estate investors to invest their money in Gorakhpur.
From allocating money for construction of modern auditoriums to establishing burn units in government medical colleges, the government is working to transform Gorakhpur into a highly developed city apt for all types of investment.
Frequently Asked Questions
What is CREDAI?
Confederation of Real Estate Developers’ Associations of India (CREDAI) is the prime body of private real estate developers in India that is working towards transforming the landscape of India’s real estate sector.
Which are the top localities in Gorakhpur?
Some of the best localities for investment in Gorakhpur are Maniram, Taramandal, Shahpur, Medical College Road and Motiram Adda.
Which offers better tax benefits – commercial or residential real estate investments?
Purchase of residential real estate offers better tax benefits under sections 80C and 24 of the IT Act if the property is acquired with the help of a home loan.
What are the property rates in Gorakhpur?
Starting price of property is ₹105 per square foot in Gorakhpur, and average price is around ₹2,820 per square foot. So, as per the price trends, both buying and selling property in Gorakhpur are profitable at the moment.