11 Things To Consider When Buying a Second Home for Investment in Kerala
Planning for buying a second property? How to buy a second investment property? On the off chance that you effectively own a home are still left with some money to contribute, purchasing or buying a second property is a wise venture choice. Purchasing a subsequent home probably won’t be as troublesome as purchasing the first. Further, it has various advantages regarding a speculation choice or getting a customary pay through month to month lease.
Over the last few years, Kerala has acquired the fame as one of the most sought-after destinations for real estate investment in India. A point that the major tourism hubs across the world share in common is that they are the preferred destinations for investment buying.
These places keep on receiving a high count of tourists that looks for private accommodation in the course of their vacation. Thus, property owners, owning vacation homes in those destinations can earn significant revenues by renting those properties to the tourists. In a similar style, Kerala, being a noted site of tourist interest in India, is the perfect site for investment buying.
Thus, if you hold the plan of buying a second home for investment, Kerala will be one of the best choices for the destination. Paragraphs underneath shall discuss a few key points that you need to know in those instances. Also Read Things to Consider Before Buying a Vacation Home to Rent in Kerala.
Let us discuss the main points or things to consider when buying a second home for investment.
Things To Consider When Buying A Second Home for Investment In Kerala:
1. Find the Perfect Location
Remember, you are buying a second property for rental. Hence, the most important action that you need to take is to identify the right location.
It is for the reason that your revenues will come from the tourists, who usually prefers to stay close to the sites of tourist interest. In terms of the Kerala, you should opt for the locations like Kovalam, Kochi, Munnar and Alappuzha that receives that major count of the tourists.
Properties, lying in and around the tourist’s spots and sites of interest for the tourists will have the maximum demand. Hence, you should always prioritize on these areas as the site for your vacation house.
On the other hand, the mainland city areas, areas near the railway station and bus terminus are other few zones that you can consider while purchasing second home in Kerala. Checkout about some Eco friendly apartments.
2. What About the Facilities and Amenities?
You should keep in mind that the available facilities and amenities can greatly influence the demand for the vacation house. Tourists will prioritize your property over the luxurious and comfortable hotels, lying close your property.
Hence, they deserve something extra that they will not get in the hotels. The feeling that drags the tourists towards the private vacation homes is the aspiration of getting a homely ambiance, outside their home town. Hence, the availability of the necessary facilities and amenities will turn to a major factor.
It is not important to parallel the luxury, offered by the 5-star hotels, but, it is crucial that you offer your tenants a homely feeling. However, ensure that the tenants get those arrangements that will ensure their safety and make the living convenient. Also read about the summer decorating ideas for living room.
3. Smooth Communication is Absolutely a Must
Even if there are ample of car rental agencies in Kerala, catering to the tourists, smooth connectivity between the vacation home and the sites of tourist interest is of paramount interest. Thus, vacation houses, lying closer to the tourist destinations.
Alternatively, vacation houses, lying near the bus stands or railway stations enjoy the maximum demand. You can make a tie-up with a local agency so that your tenants get the adequate support for their transportation needs. Get some real estate trends in Kerala.
4. The Property Should Match the Lifestyle That the Tourists Want
As a vacation home, you will be renting to the property to the tourists and not to the permanent tenants. There are some fundamental difference in the lifestyle of the tourists and the permanent occupants.
It requires no knowledge of rocket science to predict that vacationers look for luxurious stay during the course of the vacation trip. Hence, it will be great if your property includes features like swimming pools, playing area, outdoor living arrangements, Jacuzzi, and a slot for barbeque, for instance read the checklist before buying a flat in Kerala.
5. The Property Should have Sufficient Space for the Tenants
This is one of the important things to consider when buying a second home. Analytics establish the fact that more than couples or the business tourists, the families opt for the private vacation homes. Thus, it is important that your property should have enough space to accommodate these flocks.
Remember, there are chances that 2 or 3 families in a troop can rent your property. Hence, your vacation property should have enough space and adequate arrangement of rooms to accommodate such larger troops. And watch out for these hidden dangers before buying a house in Kerala.
In this regard, it will be wise to discuss the head count of the tenants, before renting out the property. This will prevent the chances of renting the properties to large troops that will be impossible to accommodate within the space available. If you can extend the right comfort and convenience to the tourists, they will approach you back, each time they visit Kerala.
6. Consider the Finance Option
Availability of adequate finance is another important aspect of consideration while buying a second home for rental. As in other destinations, the pricing of the properties in Kerala is rising sharply and property investment always involves significant investments.
Hence, it is most likely that you will require financing the property purchase. Reach out to the banks and other financial service companies and discuss your finance needs with the officials.
These days, lenders design special schemes that ideally suit the purpose of financing a second home and repayment capacities of the investment buyers.
Seeking guidance and assistance of the officials of Banks or the financial corporations, you can even explore schemes of buying a second property with no money down, up front. These schemes will enable you to accomplish the aspiration of buying a second property without getting into much of hassles. It might be helpful to read about the home loan process in India.
7. Your Expenses Should Keep Par with Your Income
Though you approach the investment with expectations of earning significant revenues, you should ensure that your expenses are suiting to your income. Especially during the initial phases, when the rate of booking is likely to be towards the lower sides, you will require paying the monthly installments for repayment of the loan as well as paying for the maintenance and taxes, out of your pocket.
Hence, it makes sense to keep these expenses that you can afford out of pocket, at least till the time, the revenue from the rents are able to meet those expenses.
If you already have a property in Kerala, explore how to buy a second home and rent the first. The proceeds from the first property can enable you to meet the expenses for the second property.
8. Get Knowledge About the Implications of Property Taxes
Even before you make the investment, you need to get conversant with the prevailing tax rate structures of Kerala. Remember, the tax structure and rates will vary between the residential and investment properties.
You will do it wise if you seek assistance and guidance of the tax consultants who will be able to guide you in these regards.
9. Arrange for a Reliable Caretaker
Especially if you are staying out of Kerala, you need to arrange for a reliable caretaker who will manage and supervise the property on a daily basis.
These days, there are professional agencies that take up such assignments. It will be wise to hire such agencies as you can expect more efficiency and integrity from such providers.
These agencies will handle the complete scope of responsibilities like paying the taxes, arranging & supervising the maintenance and repairs, representing you to the tenants and coordinate with the local bodies and entities on your behalf.
You should keep in touch with the agency on a regular basis and in turn, supervise on the actions and activities of the agency. Another wise investment choice is trying low cost interior decoration ideas for your home.
10. Use the Property Yourself When There is No Booking
It is obvious that sometimes, your property will not have booking form tenants. In those instances, you should use the property yourself or you can send some reliable people to stay there.
From an emotional perspective, spending a few days in your own vacation house can give you a feeling of accomplishment. On a practical note, if you keep visiting your property from time to time, you can find out the probable ways to make it more liveable and enjoyable. Checkout some tips to setup terrace garden apartments in Kerala.
11. Don’t Pamper Unrealistic Expectations
A blunder that the majority of the investment buyers do is that they approach the investment with unrealistic expectations in terms of the revenue that can generate from the rents.
Understand, it is going to take time for your property to get popular with the tourists and generating the revenues in significant income. Hence, you should keep the running costs related to the property within the extent that you can afford yourself.
Going the other way, you will find yourself in challenging situations. Get some real estate myths that you should know so that you can make a wise decision regarding your property.
When you are aspiring for buying a second home for investment, you need to keep in mind the points discussed above. These suggestions will enable you to approach the investment process in the right style.
Remember, investment guide is all about balancing the risk factors with the right approaches. Kerala has got a wonderful potential as a destination of investment buying and hence, you can certainly expect to reap significant capital and revenue gains, investing in the properties there.
If you are still wondering is buying a second property is a good investment option, you should certainly feel confident, considering the fact that innumerable investors have ventured into buying a second home for rental and the majority of these investors have reaped delightful outcome. Also read the benefits of investing in apartments.
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