Saturday, 8 August 2015

Tips to buying your second home

The average Indian investor's favourite investment is in the real estate market. Lately, people are investing in second homes and holiday homes as well. Second homes offer a great source of constant income when rented out. In most major cities, there is always a great influx of job seekers and students which increases the need for houses on rent. This fact means that buying a second home in a large city is always a good idea.

1. Avoid investing in the ultra posh neighbourhoods of big cities. It is highly unlikely that you will find too many takers in the rental market. Instead, invest in established central areas where the rates are reasonable and the need for places on rent is high. This improves your chances of finding a tenant.

2. Invest in cities like Pune, Vadodara, Thiruvananthapuram, Jaipur, Bangalore, Chennai and Hyderabad, where the rates are affordable and where the need for rentals are high.

3. Buy a second home in an area which is located close to important amenities and facilities such as schools, markets and hospitals. Owning a small home in such an area is better than owning a large home in the outskirts of the city, in terms of appreciation and returns.

4. Before giving your house on rent, be sure of the tenant's credentials and reliability. Get a watertight agreement done by a good lawyer.

5. Talk to experts in the field of investment and real estate before buying a second home.

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