Goa’s real estate market is burgeoning and if there is a right time for property investment in Goa, it is now. The real estate market in Goa is essentially categorised in two sectors—residential real estate and commercial real estate. While the residential segment is gaining traction amongst investors as there are a myriad of luxury villas in Goa that are in development. Meanwhile, business owners and professionals are looking for rewarding commercial spaces in Goa for investment to expand their portfolio and grow their business manifold. There are many categories of commercial real estate such as retail and office space, automobile showroom, hypermarkets, gym and fitness centres, restaurants, cafes, spa and wellness etc, that can benefit from being located in a prominent commercial space.
Goa has always been a popular tourist destination, and now, with new infrastructure projects and residential development, this tiny state presents significant and lucrative business opportunities. It is critical to note that commercial properties are big-budgeted large investments and must be purchased from reputed builders in Goa who possess a proven track record of timely delivery of properties and ensure transparency. Besides, there are certain criteria which should be ascertained beforehand to determine whether a commercial property is right for you or not. For instance, the location of a property plays a massive role in gaining visibility for your business. More prominent location for a commercial property translates to more eyeballs on your business, and therefore, higher brand recognition. Similarly, the construction quality, width and the visibility of your property’s facade, as well as whether it faces the main road, also plays a crucial role for your business growth.
Now let us take a closer look at the advantages of investing in commercial property in Goa,
Advantages of Commercial Real Estate Investment in Goa
1. Growth for Business
Investing in commercial property in Goa offers significant monetary benefits and growth for business. Having possession of a commercial space in Goa’s prominent location such as Porvorim provides a dedicated area for your business set up. Running your business from a commercial space in a posh location and high-end infrastructure enables you to attract customers, drive sales and generate income. Owning a commercial property in a shopping plaza or commercial complex is even better, since such spaces house a myriad of retail chains and services like restaurants, cafes, gyms, car showrooms and spa facilities all under one roof. This allows you to attract diverse clientele and affluent customers with high spending power.
2. High Rental Income
If you don’t wish to use a commercial property for business and seek to invest in one as an investor, commercial real estate generates high rental yields. The rental income generated from commercial property is consistent, higher and steadier than a rental income generated from a residential property. A rental yield of 6% to 10% generated from a commercial property is generally considered good, but with a prominent location and surrounding businesses, it can easily go up to 12% to 14% on an annual basis. Therefore, having a commercial property offers you to gain a year-round stable rental income with higher return on investment.
3. Professional Tenants
Another great advantage of investing in commercial property in Goa is that you get professional tenants like banks, franchise businesses or retail chains. These tenants rent a commercial property from a business-oriented outlook and are keen on establishing their enterprise to gain prominence in a market area. With professional tenants such restaurateurs, salon owners, car showroom dealers, you can enter in a long term leasing and rental agreement. This practice ensures stable and steady income flow for real estate investors. Commercial property tenants are more inclined to maintain healthy business relations and are more likely to pay their rent on time.
4. Tax Benefits on Commercial Property
You can avail tax benefits on loan interest for your commercial property. There are deductions under two heads—the first is the Standard deduction where commercial property owners are allowed to deduct at the rate of 30% of annual rental value for repairs, insurance, electricity, water supply etc. The second is Deduction of Interest under Section 24 of the Income Tax Act which you can avail on the interest paid on loan taken for purchase. Plus, the processing fee for commercial property loans is also regarded as interest and is also eligible for deduction. These deductions and tax benefits can greatly reduce the financial burdens of business or property owners.
5. Diversification of Portfolio
For any investor it is crucial to have a diverse and resilient portfolio that reduces their risk and secure them in turbulent economic times. By investing in commercial real estate in Goa which is likely to grow manifold in coming years, investors can move towards safe diversification. Unlike other assets like stocks, bonds and mutual funds, commercial real estate offers steady and stable ROIs and protects against inflation.
6. High Appreciation
If you invest in a commercial property in Goa which is located in a highly accessible and prominent location, the chance of capital appreciation is certainly high. By investing in a commercial development project that groups many businesses (restaurants, retail stores, showrooms) together under one roof, you can receive higher ROIs. One such project is Veera City Center, a multi level shopping plaza located on Goa-Mumbai Highway in Porvorim, and a few minutes away from the capital Panjim. It is an incredible opportunity to take your business or retail chain to the next level in one of Goa’s eminent locations and attract both local and tourist customers. Get in touch with our team today and invest with Veera Developers Group.