Guide for Hospet Commercial Real Estate investment

Hospet is the largest city of the Vijayanagara district in Karnataka, creating a connecting link between the north and south region of the state. It is a well-known tourist destination, mainly due to Hampi and Tungabhadra Dams which are located close to this city.

As a prime tourist spot, this place has well-developed roads, railway lines and airways to provide smooth connectivity. Moreover, on an average basis, approximately 16 flights and 26 trains pass through Hospet daily. All these features make Hospet one of the prime commercial locations in Karnataka. 

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Top Reasons to Invest in Hospet Real Estate

The top reasons to invest in commercial real estate property in Hospet are as follows:

1. Tourism

Hospet is a famous tourist destination witnessing almost 6 to 7 lakhs tourists every year. The World Heritage Site of Hampi is the most famous tourist attraction here, including many other temples and monuments. Thus, this place is home to famous hotels and restaurants that are visited by tourists.

2. Connectivity

As a tourist location, this city also provides great connectivity through roads and railways. It also connects this city to other important places through highways like NH 63 and NH 67. Furthermore, it also has an airport to ease connectivity via airways.

Commercial Real Estate Investment Opportunities in Hospet

The locations with the best commercial real estate investment opportunities in Hospet are: 

• Talur Road

Talur Road in Hospet is a well-maintained area with all basic amenities and developing infrastructure. This city is also connected to many important areas through roads and railways. Moreover, this area has many shops and stores. 

• Malligi

As Hospet is a tourist destination, there are multiple hotels and restaurants here. Malligi is home to most of them as most tourists usually choose this place to stay. It is also in close proximity to various transportation facilities.

Also Read: Guide for Purnia Commercial Real Estate Investment

Things to Consider Before Buying a Commercial Real Estate Property in Hospet

The main things to consider before buying a commercial real estate property in Hospet are as follows:

• RERA Verification

The Real Estate Regulatory Authority (RERA) is a statutory body to promote transparent and authentic transactions between real estate agents and buyers. It was notified by the RERA Act of 2016.

Every state has its own RERA body that records and updates all information regarding the properties and builders registered to the state. Make sure to visit the website of RERA Karnataka to check the authenticity of commercial property in Hospet. 

• Infrastructure

You should evaluate a location’s infrastructure before investing in its real estate. Investing in a location that has basic amenities, transportation and convenience will have a better return potential than properties lacking modern amenities.

Stamp Duty Rates in Hospet, Karnataka

The stamp duty rates for commercial property sales in Karnataka are in the following table:

Registration Charges in Hospet, Karnataka

The registration charges for commercial real estate in Karnataka are in the table below:

The registration charges and stamp duty rates will be a part of your investment amount. Hence, it is essential to consider these charges while planning the budget.

Commercial Real Estate Sector in Hospet: What’s the Forecast? 

On April 25 2022, the Karnataka government cut property guidance value by 10% for another three months. This guidance value is the minimum selling price fixed by the government on the property depending on its locality and structure type. This will promote commercial property investments by small and medium property investors. 

Moreover, some parts of this state have witnessed rental growth of approximately 5.8%, especially in Q1 of FY 2022. All of these changes in the real estate sector of Karnataka have influenced the real estate of Hospet as well. 

Commercial Real Estate vs Other Asset Classes

Here is the comparison of commercial real estate and other asset classes: 

• Commercial Real Estate vs Stocks and Mutual Funds

Stock market and mutual funds provide comparatively higher returns but witness great fluctuation with higher risks. On the other hand, commercial real estate offers assured returns with direct asset ownership. 

• Commercial Real Estate vs Residential Real estate

The vacancy risks in residential properties are higher than in commercial estate with frequent tenant turnover. Moreover, residential properties need to be leased on an annual basis, but office spaces can be leased for longer tenures.

• Commercial Real Estate vs Gold

Gold is highly liquid when compared to commercial real estate. However, real estate is a stable investment option that acts as a source of passive rental income, which is not the case with gold. 

• Commercial Real Estate vs Bonds

Bonds have a low credit risk when compared to commercial real estate. Additionally, bonds are highly liquid than real estate investments because the latter requires high transaction costs, and it can take a long time to find a suitable buyer for the property.

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A tabular representation to compare the assets based on returns, liquidity, risk, volatility and ticket size is as follows:

Steps to Invest in Commercial Real Estate in Hospet, Karnataka

The steps to invest in commercial real estate in Hospet are as follows:

Step 1: Conduct proper market research and finalise your financial budget.

Step 2: Shortlist some budget-friendly sites and analyse them minutely by making a field visit to each site.

Step 3: Finalise a commercial real estate property that is suitable and purchase the property.

Step 4: Prepare official documents and complete stamp duty and registration charge formalities. 

Step 5: Pay service fees to real estate consultants and brokers if availed of their service.

Step 6: Cover your new property with an insurance plan.

Read More: Guide for Sambhal Commercial Real Estate Investment

Final Word

The outlook of Hospet for commercial real estate is quite promising due to its connectivity and location. It is a famous tourist destination creating demand for a commercial sector based on tourism. However, if you plan to invest here, conduct thorough market research or consult a real estate agent to avoid fraudulent activities.

Frequently Asked Questions