Buying your second property? Here is the checklist

Second home, a nomenclature designated to vacation house, investment house, or simply a home for the extended family. Whatever name you call it, second home market is developing as a cash cow for the investors and developers alike. Let us look into the concept of home away from home in some more detail and see a checklist to help make it a profitable venture without burning a hole in your pockets.

Buying a second house is very similar to buying the primary residence to some extent. However the dynamics might change depending on the purpose for which the property is bought. The purchase of such houses depends mostly on disposable income, as they are bought to match the lifestyle choice more than the primary need. Thus a lot of other things like purpose, affordability, and location etc. come into the picture.

For someone planning to buy a second house, hundreds of things need to be considered. It has been observed that it all comes down to a few basic points like purpose, affordability, location, and some other similar factors.

If you are struggling with the decision of whether or not to buy a second house, here is a checklist of decisions that you will have to encounter in order to take a sound decision. Give them a thorough thought before you go ahead and buy a house.

• Buy an age friendly house

Investing in a retirement house is also a very common thing. If that is your plan and you have decided on living in the second house, opt for an age friendly house. The amenities offered by the project will play a major role here. For a house that you plan to retire in, it should have all the care facilities, ATMs, shopping complexes, etc. in close proximity.

In India, places like Pune, Bangalore, Chennai, etc. are seen as age friendly cities. So if you plan on retiring in comfort, buy an apartment in Bangalore or opt for a house in Pune or Chennai.

• Think about the location 

It is one of the main considerations that second-home buyers take. The first part is to decide whether to invest in your city or buy a house elsewhere. Factors like safety, property values, rate of returns, etc. hold importance in deciding the location.

For those looking to buy house in the same city, pointers like purpose, location, and neighborhood plays a major role.

If you plan to buy a house for investment purposes, go for areas near metro routes or high on physical infrastructure front. In a country like India, where the real estate developments are on an all-time high, there are a number of profitable options available to you as second house destinations.

• Purpose of the second house

The purpose of buying a second house should be clear before you make the investment. Decide whether you are looking for retirement house, vacation house, or for investment needs. The location, price of project, and future of the property depends on this choice.

When buying house for vacation, the factors like returns, neighborhood etc. are overridden by luxury, comfort, and status-quo. And when you buy a house for investments, the exact opposite happens.

• Finances 

The main concern when buying a second property is Finances. If you already have the first property going on EMI, it is important to decide whether you want the second property on EMI too, or you want to pay the loan off on the first one and start a fresh loan scheme.

The affordability should always be given a priority. Avoid keeping both the property on loan. Have a good portion of the income with yourself to handle any exigencies with ease.

• Decide what happens with the old house

It is closely related to the purpose point. Before you buy the new house, decide what you are going to do with the old one. It is seen that people often live in the new house and put the old one on rent. Do proper house-benefit analyses before you decide on something. The pricing and EMI is the first thing that will directly affect this decision.

Before you finalize something, work on the tax benefits and insurances, to get a clearer picture of what is beneficial for you.

• Land vs. Apartment

Another important decision to take is Apartment vs. Land analysis. People who have already acquired a piece of land prefer to buy an apartment as their second house, and vice-versa. Again factors like purpose and affordability, finances play a major role here.

Along with huge tax benefits and a place for retreat or simply a source of extra income, second homes offer a number a benefits to the owner. However, the intensity of decisions in terms of how crucial they are increases in the second time round. Before you start searching for properties, go through the checklist and take a calculated decision.

This is a guest post by Tripti. Tripti writes on the behalf of 99acres.com. Her articles talk about new developments in the real estate industry. She is an avid fiction reader, craftsman and a keen observer. Being someone who just observes without having a point of view, she keeps herself updated in real time. You can reach her on LinkedIn.

5 Factors You Must Consider before Buying Plots

Whether looking to buy plots for your dream house in popular cities such as Mumbai, Delhi, Chennai, or Hyderabad, or simply making an investment in one, it is important to consider the following factors before making any rushed purchase:

1. Checking, verifying licenses and certificates

Tiresome as it may sound; getting some specific licenses checked and verified by a consultant is of prime importance before buying a plot. These include:

1. Title deed: This is a legal document that shows you have the right to the ownership of the plot. Before buying, confirm that the deed from the seller (or re-seller) has full right to the ownership of the property, and that it meets all necessary approvals from the authority.
2. Encumbrance certificate: It is a proof that the property is free from all/any monetary and legal liabilities. It also shows that the property can be sold as free title and that there isn’t any problem associated with the ownership. Ensure that this certificate says the land is free from the earlier-mentioned dues or liabilities.
3. Release certificate: This is important especially when dealing with resale lands. This certificate, which you get from the bank you have pledged a loan from, shows that the land you are about to buy is clear from all impending loans. It shows that any loans on the land in question have been repaid.
4. Property tax receipts: Any bills from the owner that haven’t been paid for, for a land on resale are shown on these receipts. Ask for tax receipts from the owner to ensure there isn’t payment pending from the original owner.
5. Approvals: Make sure that the land-use is permitted as per the city plan. You can get this from the local pubic-body office in your city. Additionally, ensure that the plot layout has been approved by the local body and the development corporation.

2. The wrong impression of renting the property

You may buy a particular land thinking you will cover the EMIs through renting the land. It may be a miscalculated or erroneous approach, as experts say rental benefit on residential properties is a meager 2-3%. Secondly, it may require a much longer duration than expected to rent out your property.

3. The right buying cost

When asking a broker about the plot, ensure that he or she tells you the final cost of the plot and not just the basic one, as such is the case many a time. They may keep you in the dark with respect to extra costs such as, but not limited to: Service tax, preferential location fees, development fees, etc.

4. Look out for available plans

You may be eligible for a guaranteed rental scheme that lets the developer pay you rent during construction of the plot, for a fixed period. Then there is another scheme that lets the developer pay you after the possession. In such cases (and schemes), the properties are generally located outside the city limits.

The fact of the matter is that you need to be aware of all the available schemes or plans before making the payment for your plot. While some may benefit you, some may also result in loss such as subvention schemes where the price is generally 10% higher of normal.

5. Constructing costs

When choosing to make your house, consider these for the construction costs:

• Home designing plan of the architect
• Contractor’s fee
• Labor cost
• Interior fittings such as tiles, bathroom fittings, etc.
• Building material costs

It’s wise to pay more towards the initial cost for building your house than to spend extra money at the time of reparation or maintenance.

Whether you plan to buy plots in Hyderabad or an apartment in Mumbai, you must consider these factors to make a wise decision.

This is a guest post by Dinesh Dawde

8 mistakes to avoid when buying a home

Author: Sachin Gupta | Find me on Twitter Follow @sach_gupta

Home buying is a long term commitment and therefore one should not rush through the things. Going through a well laid down process will eliminate following common mistakes.

Mistake 1

Buying a home in a builder project means there are additional costs to it. External/Internal development charges, Preferential location charges, club membership, fire fighting charges, one time lease rent, Maintenance charges, car parking are some of the charges that are billed on top of base selling price. These charges put together can range from 18 to 20 % of total cost of home. Once possession is given, you will have to pay stamp duty and registrations charges too.


Mistake 2

Borrowing means you will be paying EMIs. And more you borrow, higher the EMI or you pay EMI for longer time period. Do your calculations and make sure you pay as much as possible in down payment and borrow the rest. There is no point in borrowing 80% of property cost when you can arrange for more funds for down payment.


Mistake 3

Plan at least 3 years before you plan to buy a house. That way, you will have enough surplus funds to make the down payment and borrow the rest from bank.


Mistake 4

Home affordability is a key consideration and one should never lose sight of it. Home affordability means what is the value of home that you can afford given your current income levels. You can easily calculate Home affordability here.


Mistake 5

We all dream of living in a house that is big and has all the world class amenities, but can you afford it?


Mistake 6

Do not ever overlook due-diligence part. Ask for approvals, land title certificates, license number form the developer.


Mistake 7

If buying a home for investment purposes, make sure you do not lend in a soup and have enough cover to pay for home installments. When realty market was going strong, investors/speculators entered the market in the hope that they will make windfall profits, but things have become tough. Most of these investors/speculators are willing to offload their purchases at relatively very low rate of returns.


Mistake 8

Make sure your finances are in order and you have pre-approved home loan before you start your search for home. This way, you will not overshoot your budget.

Did you make any of the above mistakes???

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What are your Rights as a Home Buyer?

Are you planning to buy a home of your dreams? Well, buying a home is a bit tedious task. It involves many complex legal processes. Buying a home is perhaps one of your largest financial investments. Isn’t it? Particularly, if you are a first-time home buyer, your mind would be filled with hundreds of doubts and questions.

For instance, if someone is looking for flats in Calicut, he/she would be concerned with his /her rights over the property, terms and conditions offered by the builders, delays if any and other problems. As a home buyer, you might have many questions.

Before diving into what the home buyers’ rights are as per the Government norms, let us first analyse the process of buying a home in India.

1. First analyse your financial situation and requirements.
2. Find a property that caters to your specific requirements.
3. Inspect the property and seek professional help if needed.
4. Get into an agreement with the seller. Ensure that details like price and also personal details of both buyer and seller are highlighted before signing the same.
5. Find a reliable lender. It is always recommended that you associate with reliable financial institutions like the SBI while applying for a home loan. Play it safe.
6. Perform a thorough analysis of your property to avoid any loopholes in the agreement.
7. At the time of closing, ask seller for all the legal documents associated with your property and get it registered in your name.

These are some of the common steps that one follows while buying a home. Now, let us shift the focus on the rights of a home buyer. As a home buyer, there are several rights granted to you that include mortgage loans, the rate of interest on loan and several others. Awareness of such rights protects you from being duped.

Here are some of the rights that you are entitled to as a home buyer:

Right to obtain information
The home buyers are eligible to know the details of sanctioned layouts and plans of the building. They can also claim for the specifications which are approved by the construction control authority.

Right to know the stages of construction
Under RERA, the home-buyers are entitled to know the stage-wise schedule of the construction of the project. It includes the provision of water, electricity, sanitation and other amenities promised by the builder.

Right to possession of the property
The home-buyer has the right to claim possession of the building, plot or apartment. It is the duty of the builder to provide all the legal documents to the buyer.

Rights to document
It is the duty of the real estate builders to handover all the legal documents related to the property to the home-buyer. Under RERA act, allotted can claim documents and plans of the common areas.


These are some of the rights one should take advantage of as a home buyer. So, if you are looking for your dream home, exercise your rights and make an informed decision. Let me know if you have any doubts or your feedback in the comment section below.


This is a guest post by Sreekanth, who is a digital marketing expert at Webdura Technology. He enjoys experimenting with new techniques in both print and the web. He also loves to explore roads less traveled. Reach him by writing in your details in the comments sections.

What are the various way in which I can raise funds to buy house?

Author: Sachin Gupta | Find me on Twitter Follow @sach_gupta

Now that you have decided to buy a home, you need to determine the home affordability and sources of home finance before you actually approach the developer to buy your dream house.

First thing first, what is the value of home that you can afford? Well, home affordability is derived by taking into consideration your current household income levels, and monthly expenditures. Here is the detailed example of calculating home affordability.

Now, the crucial aspect in home buying is sources of funds.

Let’s say, based on your current income levels and monthly expenditure, it is determined that value of home that you can afford is Rs. 6000000

As per banking norms, you can avail 80% of this as home loan from banks or housing finance companies. However, check your loan eligibility from the local bank. Your loan eligibility depends on host of factors such as nature of loan, amount of loan, income of the applicant, financial status of the applicant, his/her age, qualifications, number of dependents, spouse's income, assets, liabilities, stability and continuity of occupation, income, expenditure and savings history.

Home loan = 60 lacs x 80%
                  = Rs. 48 lacs

How do you source the remaining Rs. 12 lacs?

• Cash savings

Firstly, Pool in the cash that you and your spouse may have accumulated over a period of time. Additionally, if possible, you can borrow the money from your close relatives or friends. The benefit of borrowing from family sources is that you will be paying zero or low interest as opposed to borrowing the same amount from commercial lenders.

• Fixed deposits

If your fixed deposits are nearing maturity, unlock them. Or one can also avail loan against fixed deposits. Banks normally lend 70-80% of the total value of fixed deposits.

• Savings in the form of shares or mutual funds

Shares and mutual funds are highly liquid asset class. You can trade your stocks and generate the money that is needed to make the down payment for your home. Some banks also offer loan against these securities. Check with your bank about the eligibility for loan against your stocks or mutual funds. The interest rate charged (10 to 14%) will be in direct proportion to the nature of your stocks and mutual funds.

• Personal loan

This is probably the easiest way of making down payment for your home. If you are employed, approach your company’s bank for personal loan. Your company’s official banking partner will certainly have attractive interest rates schemes for the employees. We have noticed in past when employees were given personal loan at 11-12% as against the market norm of 17-18%.

• Loan against gold

Indians are the largest consumer of Gold. Your gold collections may be lying idle at home or in your bank locker, instead why not unlock the value of gold? It will definitely be handy towards your down payment. Gold is relatively a safe asset class and therefore, banks will charge relatively low interest rate when sanctioning loan against gold. Approach your bank for loan against gold and you will be surprised at ease with which banks will provide you loan against gold.

• Provident funds

Provident funds can also be a reliable source of generating funds towards down payment. One can also avail loan against his/her provident funds.

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5 REAL ESTATE MISTAKES MUST AVOID IN 2017

 Image source: www.propertyportalwatch.com

Dealing with the real estate finance and property matters is an uphill battle. You never know which move will make or break your future plans. Especially for the first-time dealers or the new beginners, the real estate dealings are a learning road. The investors step into this new world of investments and weigh the pros and cons of various property deals against each other. Once they are fully satisfied and have talked to their agents and lawyers, it is only then that they get into a contract with the seller. Even then, the beginners and even professionals tend to make unforeseen mistakes at the time. But, through thorough research and learning, they can do their best to avoid the common pitfalls that can be disastrous.

Here are the common mistakes that can be avoided easily if one has some background of financial and real estate guidance. The mistakes are as follows:

• Lack of research

Image source: jllapsites.com/real-estate-compass

Most of the investors while dealing with property do not know everything that they should. The real estate agents take advantage of this fact and there’s a high chance that they’ll allure you into making less beneficial deals. This is where your knowledge and a good support system are required.
The lack of research can be in choosing the right location or in financing (discussed ahead). Many new investors ask very few questions regarding the property they are shown. This is a big mistake! You should ask everything about the place. How investing there is beneficial? What facilities does it offer and a lot of other things? Say if you are interested in investing in the property located on the Al Marjan Islands UAE, wouldn’t you ask about the other UAE islands and the other potential areas? You must approach every possibility that you can.

• Not having a strong financial approach

 Image source: realtybiznews.com

The property investors, home buyers, building renters, everyone must have a strong financial background. The dozens of mortgages offer, loan plans and financial funds are available in the market with the purpose of helping the investors purchase what they want. Here, sticking with the budget you have is very important. Some of the investors are attracted to homes and buildings with a higher price. As a lot of other expenses should be taken into account before expanding the budget, spending money on such a deal is a waste of your money and time. Other bad investments include those with a high-interest rate, high monthly payments, and balloon payments.

• Giving up easily on negotiations

Image source: lehmbergrealty.com

Good communication and negotiation skills are a trump card in the real estate dealings. You need to have a strategic approach if you want to get a good deal and negotiations play a very important role here. To excel in this domain you need to learn the basic techniques and tricks of property dealings. What many investors here do is they give in easily to what the agent has said. Even if they aren’t satisfied with the deal, they fail to negotiate with the agent. Then the end results, in this case, aren’t good enough. This is why you need to learn how to negotiate or at least know the basics of the essential things and how to talk about them before signing the contract.

• Miscalculating the repair costs

It’s not only the property land or the building that costs you your life savings but also the repair cost that most of us ignore to consider. The repair cost is the money one has to spend, after buying the property, on the maintenance of the building. Everything from the repair of the lost connections to painting, lawn care, the furnishing of the place and few other important tasks are included in the post-property buying expenses. A buyer must consider these and make sure he doesn’t go out of cash so that he could fix these issues as well.

• Ignoring the due diligence period

A due diligence period is the right of every buyer and those agents who don’t give it or keep it short must be stopped. As the buyer, you are responsible for the deal you are making and you must keep a reasonable due diligence period before finalizing the deal so that you have a chance to end the deal if you find some problem in it. During the due diligence period, you should hire a third-party proper property inspector who looks into every aspect of the house and analysis it. Estimate the repair cost and check whether there is any other issue or not.

Real estate investment is tricky but not impossible. If you follow the proper guide and avoid the common pitfalls we have mentioned in the article, there’s a higher chance that you’ll succeed in making your very first potential deal. Keep your head high and be attentive during the whole process. This is what it takes to get a good deal.

This is a guest post by Rachel Stinson who has always had a knack for writing, food, fashion, and places. Blogging has combined all four for her with an added bonus of enthusiastic audiences. She expertly analyzes real estates and restaurants with respect to pricing and people involved and can express her opinions in an unhesitating, engaging manner. 

Luxury houses in India: Choose EMI over rent

Are you paying an enormous sum of money on house rent every month? If yes, ask yourself, that why are you letting your hard-earned money to go down the drain? There is no need to do that anymore! Now, you can select your dream home from various luxury houses in India by investing the same money on EMI. As per research, young professionals are seeking accommodation by buying luxurious houses in India on EMI basis. When the real estate market has a lot to offer then who doesn't wish to spend a little extra and raise their standard of living? Read further to discover how young India is investing in apartments in Chennai and other parts of the country.

• Matching the demands of young professionals

When it comes to buying luxury houses in India, young, ambitious, and working professionals under the age of 30 are not looking for conventional choices. As per a survey, it was found that young adults wish to buy apartments in Chennai and other metropolitan cities. They do not mind investing in residential properties that are surrounded by greenery and situated on the outskirts of the city. The primary preference lies in high-rise buildings with required amenities.

According to the survey, it was also found that conventional residential spaces do not excite working professionals under the age of 30. The hunt is for owning a property that has a decent connectivity with the rest of the city, but the residential complex needs to offer something unique as compared to the other ongoing projects. A decent society needs to provide social comfort, as well as add to the intellectual quotient of the person. Keeping in mind the fast paced lives of young individuals, they prefer purchasing luxury houses in India that have a few restaurants and food joints nearby.

• What real estate developers think?

Today, the real estate market is buzzing with modern and upscale luxury houses in India. They understand that the young prefer properties with greenery around. Having facilities such as schools, hospitals, groceries or supermarkets, works as an advantage. Since they are working individuals, they would require a well-knit local transportation from their residence to their workplace. Hence, real estate developers are designing homes where young people can choose between both comfort and affordability. Many luxury houses in India, especially apartments in Chennai are booming with an excellent social infrastructure, lifestyle shopping malls and health care centers. Most premium projects are coming up with a temple, swimming pool, Jacuzzi, spa, badminton and squash court.

• EMI system is soon catching up with the young crowd

It has to be noted that when youngsters hunt for luxury houses in India and are away from their hometown, they avoid the conventional way of staying with distant relatives. Staying on rent turns out to be a huge hassle because you cannot make too many changes to the house as it is rented. For example, even if you would want to drive a nail into the wall, you would require permission from the owner. Banks have now made loan availability procedures easier as compared to the earlier times. The interest rates too have been brought down. These days, even real estate developers are providing low-down payments and EMI options with zero percent interest. In today’s times, owning an apartment in a contemporary housing complex has become a necessity as well as an aspiration for the urban youth. It has created a demand for quality housing and real estate developers are taking a note of this.

Nowadays, the topmost real estate developers of the country such as House of Hiranandani are coming up with the concept of environmentally-friendly buildings. They have lured potential buyers to invest in larger upscale projects with world class facilities. House of Hiranandani believes that young working individuals prefer innovative designs, classy infrastructure, and built-in modern appliances that save time and energy. Hence, they are working on developing luxury houses in India.

With young investors choosing to buy luxury houses in India on EMI basis, real estate developers are coming up with lucrative schemes for their housing projects. After all, every potential investor wishes to buy a luxurious home at their convenience.


This is a guest post by Deepak Yewle