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Many reasons to buy a second home

Friday, June 09, 2017

With monsoons on our doorsteps, builders are promoting their second home projects depicting lush greenery. Also, thanks to RERA, there is hope of better transparency. Thus, Suraj Uchil concludes it is the right time to invest

While on a weekend trip to the outskirts of the city, a friend of mine suggested at buying a property in an area which was just in the initial phase of getting developed. Though hailing from a middle class family and working in a corporate world, buying a property outside the hustling lives of the city seemed like a good idea for him. And frankly speaking, he is not alone in that thought. We are seeing a tremendous shift in people’s purchasing powers and their needs to have a place for themselves even if it means having it a few hundred kilometres away from the city.

Growing popularity
The concept of second homes which was earlier limited to only the high income segment or the NRIs is now highly sought after by the middle income group too. As my friend Krishna Nair explained, “What was earlier seen as luxury for only few is now becoming a reality for many of us. Working in a corporate environment for 22 days a month, we too want to spend over weekends with our families in a peaceful area, far away from the chaos of the city life. Thanks to the rise in work opportunities and the standard of living of the people in general, we middle class people can actually think of investing in a second home for ourselves.”

The second home market is a very huge one. One can find properties ranging from Rs 25 lakh to upto Rs 2 crore, which itself shows the scope for variety. The builders also know that the search for the second home never gets over and hence they try to get more and more of projects launched. Areas like Wangni, Murbad, Talegaon, Alibaug, Karjat, Neral, Mahabaleshwar are gaining footholds as the places to look for, while buying a second home property.

But while many still believe that the second home segment is the one to watch out for, a selected few believe that the market is ever so changing and that both customers and builders need to adapt to these changes. Yogesh Salunke from Bluebery Marketing, says “Five to six years ago, the investor to end user percentage in the second home market was 60-40. But now it has come down to as low as 10-90. Many people today are making second home projects are their first home choice. As the infrastructure is getting better and better, people don’t mind adding a bit more to their office travel. In return they are getting houses at a very good rate and away from the already saturated cities.”

Demonetisation effect
Also, post demonetisation, the real estate market hasn’t fully stabilised. People are still not very eager to invest in properties. While the affordable housing has seen a rise in registrations, the second home market has been on a slump since the move last year. Yogesh adds “while market is down and on a slump, people should in fact use this time to invest in the properties. If you choose the right project to invest, a place that is just developing, it is sure to give you atleast 15-20% returns on it. Going for a developed place doesn’t make sense but a place which is still getting developed, that would ideally be the place to invest. People feel that investing in properties when the market is down is a bad idea. But the market is going to recover and rise too. Hence investing in them now will surely give them good returns in a later period of time.”

RERA of hope
Another ray of silver lining for the second home market is the implementation of RERA. With RERA in place, there is going to be a lot better transparency in the real estate market. It will give people the requisite confidence to go ahead and invest in upcoming projects as it will keep the builders in check and the buyers no longer have to worry about the project not getting completed or constructions getting stalled. This will boost their morale and in turn also help bring about the rise in the market.

“RERA is a boon for people like us who are looking to invest in second home now. The fear that had set in post demonetisation that projects might simply get stalled for a long time has now been eliminated thanks to RERA. The builders will now be answerable to the body and hence will make sure that the project gets completed in time. As a point of view of investment, we can thus easily take the minor risk and get ourselves a second home”, explains Rohit Singh, a businessman from Chembur.

So, though there might be mixed reactions as to whether the second home segments are being used as second homes, it is wise to say that with the monsoons on our doorsteps, and with plenty of properties to choose from, including a lot of offers from the builders, this is the right time to go hunt for that second home, the home buyers have been desiring for. We all dream of having a place where we can be carefree and away from the troubles of our daily cumbersome lives. Why then leave the opportunity to invest in a good second home and make that dream a reality.

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