Guide for Latur Commercial Real Estate Investment
Latur is a city situated in Maharashtra. It is one of the largest cities in the Marathwada region. Latur is a well-known tourist destination and is famous for historical monuments like Kharosa caves and Udgir Fort. There are a large number of sugar factories located in Latur.
Apart from that, in terms of connectivity, all modes of public transportation namely road, rail and air are available in Latur. Maharashtra State Road Transport Corporation (MSRTC) and other private bus operators provide bus services in all parts of Maharashtra.
Top Reasons to Invest in Latur Real Estate
Here are some of the top reasons why you should invest in commercial real estate in Latur:
Latur is known as the ‘Sugar Belt of India’. It has specialised industries of Soyabean, Edible oil, Sugarcane and food processing. Apart from that, an IT Park has been developed as part of the government’s Special Economic Zone policy. It can be said that Latur is a bubbling hub of agro-industry.
There is a large number of specialised industrial parks like Latur Food park, Latur Integrated Textile Park and Latur Infotech park. Maharashtra Industrial Development Corporation has established a large number of industrial areas in and around Latur. This makes Latur an apt option for investing in commercial real estate.
There are several places of interest for tourists in Latur. Some of them are Sidhheshwar & Ratneshwar Temple, Shri Ashtvinayak Mandir, Shri Virat hanuman Mandir, Ganj Golai, Buddha Garden Temple, etc. All these famous tourist destinations make this location a great place to invest in commercial real estate.
Commercial Real Estate Investment Opportunities in Latur
Here are some of the localities which might be great for commercial real estate investment in Latur:
- Ganj Golai
Ganj Golai is situated in the centre of Latur city. All the basic amenities that you might require are present within walking distance. In terms of transportation, this location is well-connected by bus. Infrastructure of this location, like the condition of roads, is of standard quality. Rate of commercial property in the locality might range around ₹20,000 per square foot.
It is one of the best locations to invest in commercial real estate. Transport facilities are also great in the locality. There are hardly any traffic jams in the locality. In terms of basic amenities also, everything is available within walking distance. Rate of commercial property in the locality might range around ₹2 crore.
Things to Consider Before Buying a Commercial Property in Latur
Here are some of the points that you should keep in mind if you wish to invest in commercial real estate in Latur:
- RERA Compliance
Before buying a property it is important for you to check whether the property and the builder from whom you are buying the property are authentic or not. To confirm this, you can visit the official website of RERA Maharashtra.
RERA or the Real Estate Regulatory Authority is a statutory body that promotes transparency and authenticity in India’s real estate sector. This body came into action after enactment the of Real Estate Regulatory Authority Act of 2016.
- Analysing Locality
The locality is of utmost importance when you are purchasing a property. The price that you need to pay for the property, as well as returns that you earn, depend on the location where you are purchasing the property. Apart from that connectivity via road, rail and air are also dependent on the location where you plan to purchase your property. Therefore analysing the locality before purchasing your property might be helpful
Stamp Duty in Latur, Maharashtra
Stamp duty is a type of tax collected by the state government and is payable when you purchase a new property. Here is the rate of stamp duty applicable in Latur:
|Male||6% (Stamp Duty 4% + Local Body Tax (LBT) 1% + 1% metro cess)|
|Female||6% (Stamp Duty 4% + Local Body Tax (LBT) 1% + 1% metro cess)|
|Joint (Male + Female)||6% (Stamp Duty 4% + Local Body Tax (LBT) 1% + 1% metro cess)|
|Joint (Male + Male)||6% (Stamp Duty 4% + Local Body Tax (LBT) 1% + 1% metro cess)|
|Joint (Female + Female)||6% (Stamp Duty 4% + Local Body Tax (LBT) 1% + 1% metro cess)|
Registration Charges in Latur, Maharashtra
Whenever you purchase a property, it is mandatory to pay registration charges to legally own it. Here is the rate of registration charges applicable to people who purchase properties in Latur, Maharashtra:
|Male||1% of property value|
|Female||1% of property value|
|Joint (Male + Female)||1% of property value|
|Joint (Male + Male)||1% of property value|
|Joint (Female + Female)||1% of property value|
Latur Commercial Real Estate Sector: What’s the Forecast?
At the moment, the starting price of property in Latur is around ₹1,500 per square foot while average price here stands around ₹4,048 per square foot and the most expensive property here is ₹20,000 per square foot. Therefore, as per the price trends, both selling and buying property in Latur might be profitable.
According to a report in Outlook, Maharashtra’s food processing industry has attracted $158 million of investment. Latur has a big part to play in this as it is the hotbed of Maharashtra’s agro-industry. As Maharashtra is becoming a hub for food processing business in the country, investing in Latur might be profitable for commercial real estate investors.
Commercial Real Estate vs Other Asset Classes
Let us take a look at the comparison between commercial real estate and other types of asset classes:
Commercial Real Estate vs Bonds
Bonds are comparatively much less risky and volatile in comparison to real estate. You can however earn much higher returns in case you invest in real estate in comparison to bonds. On the other hand, bonds have low credit risk and high liquidity.
Do you wish to invest in an asset that offers risk-free and fixed returns? If yes, you can register yourself today on our website and invest in the wide range of bonds available.
Commercial Real Estate vs Residential Real Estate
Commercial real estate offers you much higher returns in comparison to residential real estate. However, in case of tax relief, you get it more in case of residential real estate if you purchase the property by opting for a home loan.
Residential real estate is much more risky in comparison to commercial real estate as tenants keep on changing in case of residential real estate; on the other hand, the lease tenure is much longer in case of commercial real estate.
Commercial Real Estate vs Gold
Gold is much more risky and volatile in comparison to real estate. However, gold has high liquidity. In case of real estate, you can earn returns on a monthly basis which is not possible with gold investments. Real estate investment is much more suitable for the long term while gold is suitable for both long and short term.
Commercial Real Estate vs Stocks & Mutual Funds
Stocks and mutual funds offer much higher returns in comparison to real estate. However, in terms of consistency of returns, real estate is much better than stocks and mutual funds because it generates monthly passive income.
In case of risk and volatility as well, real estate is better in comparison to stocks and mutual funds.
Here is the tabular representation of comparison between different asset classes on the basis of returns they generate, their liquidity, risk, volatility and ticket size etc:
|Parameters||Residential Real Estate||Stocks & Mutual Funds||Gold||Commercial Real Estate||Bonds|
Steps to Invest in Commercial Real Estate in Latur
Here are the steps that you can follow if you are interested to invest in commercial real estate in Latur:
Step 1: Fix your investment budget.
Step 2: Come up with a list of all the locations that have facilities that you are looking for in your property.
Step 3: Hire a commercial broker and visit every location on your list to confirm whether all their documents are authentic or not.
Step 4: Opt for a property only after checking whether it is RERA approved or not.
Step 5: Prepare the official documents to purchase the property such as encumbrance certificate, title deed, sale agreement, building plan, etc.
Step 6: Complete the payment process. Make sure to pay the requisite stamp duty and registration charges.
Step 7: Lastly, consider purchasing insurance for your property to safeguard yourself financially in case your property incurs any damages in future.
In terms of trade and industries, Latur is one of the most well-known localities in Maharashtra. Whether it is chamber of commerce and industry association or specialised industrial parks, Latur has it all. This, as a result, has transformed Latur into a hotbed for commercial real estate investments. Being one of the most well-known hubs of food processing and agro hub, Latur will attract much more commercial investors in the future as well.
Frequently Asked Questions
Is Latur airport functional?
Yes, Latur airport is functional. It is a domestic airport and is under the ownership of Maharashtra Industrial Development Corporation. At present, it is operated by Reliance.
Do mutual funds require a higher quantum of investment than real estate?
No, mutual funds require a minimal amount of money for investment. With mutual funds, you have the freedom to invest via a Systematic Investment Plan which requires you to deposit a small amount every month. In case of real estate, the quantum of investment is much higher and involves lakhs and crores of rupees to start investing.
Is it mandatory to pay stamp duty in case the property is transferred or gifted?
Yes, in case you receive a property as a gift or it is transferred, it is mandatory for you to pay stamp duty. However, in states like Rajasthan, Delhi and Haryana, female transferors get a concession of around 1 to 2%.
What are the taxes that you need to pay while buying a property?
Before purchasing a property, you need to pay tax deducted at source (TDS), stamp duty and service tax. Earlier, you had to pay Value Added Tax but that is no longer applicable.