Reasons to invest in a holiday home
Pierre Mario Fitter February 17, 2012India's cities are dank, dirty, poorly designed and bursting at the seams. The problem though is that there is really no easy way to get out of them. In fact, for almost anyone with a white collar job, the city is where life and work begins and ends.
With India's corporate sector expanding- the current slowdown notwithstanding- there is little doubt that more people will be migrating to these already bursting-at-the-seams cities in search of better jobs. This influx will put even more pressure on our already poor civic infrastructure and government services.
Then there's cost. A one-bedroom home within a major city now costs well over Rs 40 lakh. Unfortunately, it offers very little bang for your buck. Even raising one child, leave alone humare do, in such a set up is virtually impossible. It also means visits from out-of-town relatives or friends are out of the question.
It also means little by way of privacy. Most developers in big cities are loathe to provide much space between two homes. Afterall every square foot of empty or unused land eats into their overall development. These factors have given rise to a growing market for second homes or Pied-a-terres (French for 'foot on the ground'). Most such homes fall well outside city limits. Ideally, they're easy to reach within a few hours of driving. This allows a more regular use of the property.
Since they're all in second-tier or even third-tier towns, property prices are not as astronomical as the metros . Low property prices in these towns allow you to invest in a larger property. More space means you have more options. It's fairly common for holiday homes to have large gardens, trees, even a pool. Such luxuries are unheard of in India's larger cities. To have them within a two-hour drive of your first home makes for the perfect weekend getaway. That means you can use your second home more than 100 days a year.
If your second home isn't too close there are still ways in which it can be useful. Many developers offer you the option of putting it up as a time-share property. So, when you're not around the developer will rent it out to a third party for a small commission and you get an extra source of income .
Mysore has stood the test of time as one of Bangaloreans' favourite second home and holiday home destinations. It is one of India's cleanest cities and is also famed for its cultural and architectural heritage. In fact, in 2010, Mysore was ranked the second cleanest city in the country.
Villas are the most popular second home configuration in this town. These are available for anywhere between Rs 60 lakh to Rs 3 crore a piece. Plots can also be bought for prices ranging between Rs 25 lakh to Rs 1 crore, depending on size and location. The Queen of Hill Stations, Ooty, is another popular choice with Bangaloreans. Here, residential options can be had for anywhere between Rs 60 Lacs to Rs 3 crore for a villas and bungalow. Ooty's beautiful weather and scenery is a major attraction for most investors.
The most popular second home format for Delhiites is a farmhouse. Most such developments are located in expansive clusters around Mehrauli, Bijwasan, Rajokri and Chattarpur areas of the capital. Such properties are expensive and well beyond the reach of most middle-class buyers. Indicative prices start from Rs 2.5 crore and go beyond Rs 12 crore. Farmhouses however provide a lucrative income potential during the wedding season when families rent out such properties to host their ceremonies. Hil stations are also a popular choice with Delhiites. Many popular destinations including Nainital, Musoorie and Dehradun are just a few hours drive from the capital and make an ideal weekend getaway. Bungalows in these areas can be bought for as little as Rs 40 lakh and for as much as Rs 2 crore per plot.
The number one hotspot for Chennaiites is Pondicherry or Puducherry as it's now known. Much of this former French colony is still frozen in its colonial visage. Another location is Yercaud near Salem. This is a hill station in the Shevaroys. Pondicherry offers options from both local and national developers. Villas are the predominant second home format and prices range from Rs 50 lakh to Rs 2.5 crore. Plots cost between Rs 30 lakh to Rs 1.5 crore. Yercaud's environment has of late emerged as a magnet for Chennai-based buyers. Its recent entry makes it one of the most affordable second home markets in the country. The flipside is there are few reputed developers with projects under development. Currently, prices for homes in the Yercaud can range from Rs 35 lakh to Rs 1 crore. Plots are available for relatively low cost of Rs 10 lakh to Rs 15 lakh.