Investing in a second home is everyone’s dream, but very few manage to buy one. Though, the sentiment of owning a second home has persisted for ages, however, it is slowly becoming a trend among elite investors and middle class. Several potential home buyers are putting money into vacation homes to finance long term needs and converting it into primary homes for the golden years.
The demand for buying second homes in India is growing among NRIs, making it a profitable market segment among developers. In 2015 alone, more than 2 million vacation properties were purchased as indicated in a research report conducted by the National Association of Realtors.
Alternate income earnings:
Once you buy a second home in Navi Mumbai or Mumbai, you are bound to get advantage of gaining extra income in the form of home stays or short term rents. The first thing you need to make sure is the location you have chosen is a relaxing place – lush green surrounding featuring world-class amenities– which calms down the stress of the visitors. Additionally, you need to place emphasis on how the location rental price will help you earn more.
For your retirement years:
If you do not wish to give the home for rental purpose, then it is a perfect abode for you to spend your retirement years peacefully in your second home. The rent received from the home will secure your future financially in the later years. Many people buy a second home for the sole of making it into primary homes after retirement.
The rent received from the second home can be used for paying interest of the home loan you have taken for the flat you’re staying in.
If you are living in a home for which you have taken a home loan, a tax deduction up to
Rs. 1,50,000 is applicable under the section 80C of income tax act. In case you have invested in a second property, which is under construction then get a deduction on 20% of total interest paid. The concession on interest rate is applicable for a period of five years.
While investing in a second home in Navi Mumbai or Mumbai, make sure you have enough capital in place for managing expenses as well. Think well before making an investment decision.