How to select a holiday Home

You can buy a holiday home as a getaway apartment for your family to spend the weekends at it or you can simply rent it out to other vacationers as and when required. Nevertheless, you must bear these points in mind before buying a holiday apartment for yourself. 

Planning Ahead

The decision of purchasing such a house is a big financial commitment. It is important that you take into consideration the requirements of your family and whether you are choosing a house which you will enjoy visiting in the coming years. Most buyers have to take some kind of financial assistance when they decide to buy holiday homes and hence you should start thinking about mortgages and the affordability of the property in terms of maintenance cost. A holiday house can also be treated as an investment for the years post retirement. 

Attracting Vacationers

You should always seek the advice of a property consultant when you make the decision to purchase a specific property. You have to gain knowledge about the property market in the destination along with the tourism industry of the area where you are thinking of buying a property. For instance, some areas attract tourists only during winters or summers and you have to raise your maintenance costs and profit only within that time frame. You need to think of the kind of people who will be visiting the destination and what their needs might be. If you can match the property type with the needs of potential tenants, you will be able to reap enough profits to see you through the year. Usually tourism is down during school seasons or the monsoons (unless it is Khandala and Lonavala) and hence you have to account for the loss income when tourists do not go visiting.

Safety and Insurance

All rental properties have to obey to different safety standards. If guests become injured or sick because of unsafe environments, you may be facing a potential lawsuit in that case. All gas and electrical appliances have to be checked regularly and maintained so that they are safe enough for use. Your property should also conform to regulations of fire safety. 

As an owner, you also have to buy insurance for your property, irrespective of whether you are looking to let it out. If you are buying a house for personal use and want it in a location which is secluded so that you are away from the maddening tourist crowd, you should invest in CCTV cameras and sophisticated alarm systems for the safety of the property as houses which are away from the hustle and bustle of the city centre tend to attract burglars and intruders.

You may also read: Things to remember while selling your home

Why should you consult a property advisor before buying a home

Buying a home is a big responsibility. For most, it is the biggest investment they make in their life. Since it is your biggest purchase, shouldn’t you pay as much attention as possible to getting it right? You should enquire as much as possible into different localities, property rates, and possibility of price appreciation, social fabric, connectivity, loan approval and much more. However, it is not possible for most to get all these after balancing a full-time job. This is where a property advisor steps in.

Property advisors typically have been dealing with real estate in a city and they know which areas one should invest in. They have all the information regarding different properties that are being built in a city, the property rates that are prevailing in a particular area, the brokerage that shall be charged for a house, the stamp duty and registration fees among other things. Property advisors would be able to guide you correctly about the kind of property that is suited for your requirements (proximity to work place, easy availability of different amenities, good civic infrastructure, reliability of a particular developer, prospects of future growth and much more). Property advisors would accompany you to see different properties and point out the benefits or flaws of the property. S/he would also assist you with getting your loan sanctioned from the bank. A lot of property advisors have good relations with bank managers and they can get you the best bank rates and the most flexible repayment plan.

Most buyers nowadays consult property advisors because they need not worry about finding the best property for themselves as the advisor takes it upon him or her to get it done. You can get in touch with a property advisor online or off it. The fee charged by property advisors is almost nominal, compared to the services offered to you. 

Before you hire a property advisor, you must look into his/her credentials and ensure reliability and trustworthiness. There have been several cases in the past where home buyers relied on property advisors who turned out to be fakes. Make sure you hire the services of a property advisor who has been recommended by a friend or relative. Many sales agents of different property developers pose as property advisors and push unsuspecting home buyers into buying properties which may or may not be as good as some of the alternatives. Therefore, you must always check the registration number of a property advisor before dealing with him. You can also hire the services of property advisors who work with reputed websites. Some websites themselves work as property advisors and help you with your investment to make the most.

The demand for property advisors is steadily rising because of their professional approach to the task of home buying. If you have hired the best property advisor for yourself, you can rest assured that you will get the best of services for property India. It is quite a small sum to pay for the services that you will be receiving.

You may also read: Real Estate Investment Guide for Metro Cities

Buying Property in the Suburbs: A Guide

Most people cannot afford to buy properties in central business and commercial areas of cities for the sky high prices that they command. Since people have to move out to the suburbs, city municipalities and state governments have started providing the necessary infrastructure for living in these areas. Builders too have started prestigious projects in these areas for their potential of development in the near future, demand, low cost of production and availability of large land parcels. 

When you are moving to the suburbs to buy property, you need to bear certain things in mind that you would not when buying property in prime locations of a city. Here is a guide that you may follow when buying property for sale in suburbs.  

The area where you are buying property

When you choose an area where you want to own property, you need to decide future developments that would be possible along with capital appreciation (assuming you are buying for end use). For example, the Bangalore International Airport is situated in North Bangalore and hence areas close to it are benefitting largely. Similarly, Ghatkopar in Mumbai has been connected to the central business area of Versova which has elevated the price of property in Ghatkopar.

After considering the scope of capital appreciation in the area, you should think of the civic and social infrastructure available. Are there proper arrangements for sewerage? Do all the existing houses receive uninterrupted water and electricity supply? Are there good schools and colleges in the area? How far are the grocery or departmental stores from the neighbourhood?

Having these amenities near your residence would be a big boom because you would not have to commute much to get your needs fulfilled.

      Quality of the Property

Even though properties for sale are less expensive in the suburbs, there is no reason for them to be of inferior construction. The quality of construction is of utmost importance because you will be living in the apartment for the next 10 to 20 years at least. To make it hardy and durable, the construction materials need to be good. Inclusion of features such as power back up, backed up water supply, earthquake proof construction etc. need to focused upon by you.

 

      Builder’s Sincerity

A background check of the builder is of utmost importance when you are buying properties in the suburb. Is the builder not timely with his delivery of properties? Are all the amenities that have been promised being delivered? Have all the necessary clearances been obtained by the builder from the municipal corporation and other authorities? These are some of the questions that you must have clear answers to. 

If the builder has developed another property in the vicinity, don’t hesitate to approach the residents of the community to find out about the builder’s work ethics. 

      Your Neighbours to Be

Your well being is much dependent upon how your neighbours are. If your neighbours are not cooperative about maintenance of the society or organization of meetings, then the quality of the building would deteriorate with time. Moreover, the status of your neighbours are also very important. If your level of income and expenditure does not match your neighbours, then you may feel like a sore thumb.

Most of the development of housing real estates are being carried out in the suburbs. By following this guide, you can find a good property for sale for yourself.

Are you paying the right price for your apartment

Despite an expansion in cities, property prices are far from being affordable. Even in the far-flung areas of cities, prices of apartments are more than Rs 10 lakhs or so. Buying individual houses is out of the question for salaried individuals. Developers release attractive ads for the properties they are building, advertising the amenities that they are building within the residential community. Think this over- should you pay 20-30 percent more for an apartment simply because it has a swimming pool or a community hall built in? These amenities would hardly count at the time of valuation of the property.

There are certain factors that you must use to determine the correct price of the apartment. Some of them have been discussed below:

  

Possibilities of Capital Appreciation:Even though most of us buy property India for end use, it does not harm to find out the prospects of capital appreciation for the property India. Rarely does land depreciate in value and hence you should know the growth trajectory of capital value before buying it. Some aspects which determine the capital value growth of a property India are:

Connectivity of the property:For rapid capital appreciation, a property has to be well connected to the rest of the city. Properties which are located near a railway station or the airport undergo rapid capital appreciation. Modes of transport such as autos, taxis, rickshaws and buses must be available from the property to the central business districts. Having a metro station near the locality is an added advantage. 

  Infrastructure available: A locality which is self-sufficient does well in the property market. Greenery, wide roads, proper sewerage and water connection, garbage collection facility, cleanliness, absence of slums, uninterrupted power supply and security are some of the infrastructural factors that determine the rate of capital appreciation. There is no point in buying a luxury apartment in a residential community which is based in a slum area.

  Social Fabric: You would not be too inclined to travel 4-5 kilometers for your everyday needs. Therefore, the locality that you select should have grocery stores, super markets and departmental stores, banks and ATMs, schools, entertainment areas nearby.

  Projection of the builder for a flat: Builders use a lot of technical jargon in order to attract buyers. By quoting large numbers, they want to impress buyers into booking properties. However, research a little into the quality of the construction and the flats on offer before booking one. The common configurations on offer are 1/2/3 BHK flats by builders. However, the area of each flat is projected in a different way. 

Some of the common terminologies used include:

  Carpet Area: The area of an apartment from wall to wall.

Cover Area: The area under the roof of an apartment.

  Built up Area: The area of the apartment including the thickness of the walls and columns. Compared to what the actual area of the property India is, this is almost 10 percent higher.

  Super Built up Area: This measurement not only considers the built up area but also common spaces used by the flat such as the lift, staircase etc. This can go up to almost 50 percent of the flats.

Many builders tend to dupe buyers into booking for properties by quoting the built up or the super built up area. As a conscious buyer you must always consider the carpet area on offer as that is the space that you will actually enjoy on the property.

Everything About Tax & Housing Loans

Most home seekers have to borrow money from banks against some form of collateral in order to purchase their dream houses or apartments. Housing loans are offered by almost every bank and you can borrow money based on the facilities being offered. These loans do not take much time to be approved. The processes are further expedited if the property you are thinking of buying is approved for financing.

Home loans are granted for both salaried and self-employed individuals. Individuals above the age of 24 years and below 60 years working in reputed companies can take home loans based on their salary slip and income of the year. Professionals such as lawyers, doctors, cost and chartered accountants along with self-employed individuals can take housing loans till they are 65 years old. Property in India can be bought with home loans which come with fixed and floating interest rate. The usual term for a housing loan is between 20 and 30 years, although you can reduce the term of repayment.

CIBIL Score: Most home seekers plan for a year or so before applying for home loans because if you do not receive loan approval, you may not be allowed to apply within the coming six months. To ensure that you get approved the first time, make sure you have a perfect CIBIL score. Credit Information Bureau Limited makes note of the number of covered and uncovered loans that are outstanding in a person’s account, his/her spending and banking habits. A CIBIL score of 75 or more is considered to be excellent and banks grant such applicants loans in a heartbeat. To keep your CIBIL score above the threshold, make sure you pay your credit card bills on time and reduce the number of uncovered loans outstanding in your name (personal loan or credit card bills) to the minimum. You should check your CIBIL score every 2 to 3 months to detect discrepancies with the records you maintain.

If the property you want to buy, your papers and CIBIL score is in order, then getting a housing loan is only a matter of time.

The interest paid to service housing loan can be deducted under the Section 24 (b) of the Income Tax Act. As a matter of fact, you can get the prepayment charges deducted too, if the bank or financing institution levied it. The amount paid as repayment of principal on housing loan is deductible under Section 80C of the Income Tax Act. However, this deduction is considered to be a part of your savings and will be a part of your savings in NSC, LIC, PPF and other instruments. Moreover, the deduction is possible only when the construction of property in India has been completed and a certificate of completion has been issued by the builder.

During the festive season, a lot of builders offer to pay the EMI on your home loan till you take possession of the property. These properties are usually pre-approved for loans and you can opt for them if you know your salary or income would increase within the couple of years of construction.