Guide for Srinagar Residential Real Estate Investment
Srinagar is the summer capital of Jammu and Kashmir. This city is also called the Venice of the East for the numerous lakes mapping the city. Furthermore, its Himalayan backdrop, charming cities and pleasant valleys attract tourists all year round.
As a tier-2 city, life in Srinagar is quite simple and affordable. Moreover, unlike most urban cities, there is less air pollution, and the environment is comparatively cleaner.
Earlier, only permanent residents of Jammu and Kashmir could purchase land there. However, since the revocation of Article 370 on October 27 2020, non-residents can buy land there. So now, anyone wishing to reside in the picturesque city can purchase or rent a home.
Reports claim that 2022 witnessed real estate prices soaring in Srinagar. Read this article to the end to learn the perks of investing in residential real estate in Srinagar.
Top Reasons to Invest in Residential Real Estate in Srinagar
Here are some reasons for you to consider investing in residential real estate in Srinagar.
Srinagar is not overpopulated like other capital cities of India. Therefore, there is lesser vehicular emission here. Furthermore, owing to its location high above sea level, Srinagar provides a cleaner Air Quality Index (AQI).
With a picturesque view of snow-capped mountains, green valleys and saffron fields, Srinagar is a paradise to live in life . Hence, investing in residential properties can bring substantial gains.
Lucrative Real Estate Market
With an entirely new market opening, developers are rushing to launch new residential projects in Srinagar. Kashmir’s renowned beauty makes it one of the most desirable locations for owning a holiday or retirement home. The Maharashtra and Karnataka Governments have also announced several luxury hotel projects.
All of these factors lead to a lucrative opportunity for early investors. As property prices rise in Srinagar, you can utilise this opportunity to earn high investment returns from residential properties.
Investment Opportunities in Residential Real Estate in Srinagar
Here are a few locations where you can invest in residential properties in Srinagar:
It is a prominent historic spot in Srinagar. Several political meetings took place here to discuss the fate of Jammu and Kashmir. Since the 20th century, Lal Chowk has been a hub of businesses in Srinagar. Tyndale Biscoe School and Vasant Girls’ High School are two important schools in Lal Chowk.
You can invest in independent houses in Lal Chowk and earn from periodic rentals. Property prices in Lal Chowk range from ₹40 lakh to ₹4 crore.
Bagh-i-Mehtab is a residential area in Srinagar housing numerous government officials and private housing colonies.
This locality lies on the bank of the Doodh Ganga river near the Chadoora-Charrari Sharief-Yusmarg Highway. As a residential area, Bagh-i-Mehtab offers a range of amenities, from gyms and clubs to shopping malls and retail shops.
Property prices in Bagh-i-Mehtab start from ₹1.1 crore approximately.
Things to Consider before Investing in a Residential Property in Srinagar
Below are a few points you need to consider before investing in commercial real estate In Srinagar.
Residential real estate is a good option for long-term investment. However, before investing, you must comprehensively understand your financial standing.
It includes planning your finances by calculating your income and expenses. You need to fix a budget or a limit below which you are willing to invest in residential property. It will help you decide whether or not you require a loan to invest appropriately.
The Real Estate (Regulation and Development) Act of 2016 mandates the formation of a Real Estate Regulatory Authority (RERA) in every state.
Before investing in any property in Srinagar, you need to confirm whether its builder got the property registered under RERA. The Central Government has already laid down the RERA guidelines for Srinagar. However, the portal is still under construction.
Stamp Duty in Srinagar
Following is the stamp duty applicable on the purchase of real estate in Srinagar
|Property Owner||Stamp Duty|
|Joint (Female + Female)||5%|
|Joint (Male + Female)||7%|
|Joint (Male + Male)||7%|
Registration Charges in Srinagar
The table given below displays the registration charges (for sales deed) on residential property in Srinagar.
|Property Owner||Registration Charges|
|Female||1.2% of property value|
|Male||1.2% of property value|
|Joint (Female + Female)||1.2% of property value|
|Joint (Male + Female)||1.2% of property value|
|Joint (Male + Male)||1.2% of property value|
Outlook of Residential Real Estate in Srinagar
Several infrastructural projects are ongoing under the Srinagar Smart City (SSC) project. It includes around 85 roads, electricity and sewage projects are started in different parts of the city.
These measures will boost the tourism sector and allow for more private investment. As a result, the residential sector will likely witness soaring property prices, with more investors coming to this city.
These investors plan to set up shopping malls and other commercial and residential properties in Srinagar. Also, responding to the calls for modernity, several malls and shopping complexes are under construction in Srinagar.
Such developments act as a magnet for other investors to play their part in this city’s growth. By doing so, they can earn substantial returns on investments.
Residential Real Estate vs Other Asset Classes
Let’s look at the differences between residential real estate and other asset classes based on their ROI, risks and liquidity.
Residential Real Estate vs Gold
Residential real estate is suitable only for long-term investment. In contrast, gold can be helpful for both long and short-term investments. Furthermore, gold has a more liquid market than real estate, as you can easily buy and sell them. However, returns from residential real estate are usually higher over the long term.
Residential Real Estate vs Commercial Real Estate
Commercial properties are more expensive than residential ones. As a result, finding suitable tenants for residential real estate is comparatively more straightforward . However, you can earn more returns from investing in commercial real estate than residential properties.
Discover More: Guide for Srinagar Commercial Real Estate Investment
Residential Real Estate vs Bonds
Bonds are a more secure form of investment than residential real estate. Also, bonds have a more liquid market than real estate. On the other hand, real estate offers more tax benefits and higher returns than bonds.
Residential Real Estate vs Stocks and Equity Mutual Funds
Stocks and equity mutual funds are sensitive to market fluctuations. As a result, one needs to understand the marketplace thoroughly before investing. Owing to their volatility, one can earn high returns or face massive losses when investing in stocks. However, returns from residential real estate are stable and carry lower risks.
The table given below compares the above asset classes based on their risks, volatility, liquidity, and ticket price.
|Parameters||Residential Real Estate||Stocks & Equity Mutual Funds||Gold||Commercial Real Estate||Bonds|
Steps to Invest in Residential Real Estate in Srinagar
Step 1: Fix a budget to invest in residential properties in Srinagar.
Step 2: Shortlist a few locations and conduct on-site research to analyse the ground situation.
Step 3: Visit these locations to understand their future potential thoroughly. Also, seek help from real estate consultants to know about prospects in the area.
Step 4: Finalise and purchase a residence after checking its RERA authenticity.
Step 5: Collect the necessary documents like sales deed, encumbrance certificate and title deed.
Step 6: Pay all the necessary charges like stamp duty and registration charges to transfer the property in your name.
The above sections have covered all the advantages of investing in residential real estate in Srinagar. However, consider covering it with an insurance policy after you purchase a property. It will help safeguard you and your family financially in case of any damage to the residential real estate.
Frequently Asked Questions (FAQs)
What is a sales deed?
A sales deed is a legal contract that allows the property owner to transfer their rights and ownership to its buyer.
Can residents from other states invest in real estate in Srinagar?
Jammu and Kashmir lost its unique authority as a special state after the Central Government repealed Article 370, and it was divided into the two Union Territories of J&K and Ladakh. Since then, investors from every corner of India can invest in businesses in Jammu and Kashmir. However, this new right comes with some terms and conditions.
What are some locations to invest in residential properties in Srinagar?
Lal Chowk, Rajbagh, Bagh-i-Mehtab, and Peerbagh are some localities in Srinagar that are good for investing in residential properties.
Before investing in residential real estate, what amenities should I look for in a building?
If you invest in residential properties, especially apartments or independent houses, you must ensure that it provides some amenities. For example, it includes a clean water supply, electricity connections and backups, adequate parking space, and building security.