Kamesh Chauhan is confused about his wife’s demand for buying a house in her hometown. Though she attaches a lot of sentimental value to the one-bedroom flat, Chauhan thinks it will not be a wise investment decision to buy a property with poor facilities. They have just started their financial lives together and Chauhan is worried about locking resources in the property at this stage. How should they deal with this issue?
The returns from investing in a property can come from two sources: appreciation in value and rental yield. If the property is not in a prime location and is not new, both the forms of returns may be low. However, if the property is old, but in a good area with thriving commercial activity, it may attract a high rent due to locational advantages. This may also impact the resale value. So, Chauhan should first evaluate the returns. Read more