Life has its strange ways of dictating terms. You may buy a home with the objective of living in it till you hang up your boots, but circumstances may compel you to move to another location (another city or other end of the same city).
Imagine that you’ve landed a great new job with a more fulfilling role, greater responsibility and independence in decision making, and of course, more money and better perks.
The catch — the place of work is in another city/town or at the other end of the sprawling metropolis you live in. Much as you would like, it won’t be possible to take up the offered assignment and continue to live in your dream home.
When it boils down to such trade-offs, the decision — more often than not tilts in favour of the new career opportunity. And that will mean you must leave your home. Assume you do, over time you might realise that you will never really go back to living in the home you built.
This can be because of several reasons — career options and your new social circles . What such a situation will likely lead you to contemplate is, much as it might seem unlikely, the sale of your earlier dream home.
What this requires, therefore, is that when you buy a home to live in, buy it considering not only that it offers what you want from a home in terms of size, space, sunlight, amenities, location, etc.— but also its likely potential appreciation prospects.
The questions you therefore also need to ask yourself besides the ones you do when buying a home to live in are — what value will I get if I decide to sell the house, say, 1, 3 or 5 years from now? Will there be a lot of buyers for this house and why? If the answers to these questions too are positive, you more than likely have a winner on your hands.
Some of the factors that influence appreciation and demand are increasing job opportunities in neighbouring areas, infrastructure development (not one, but several projects so that one getting derailed doesn’t deliver a value devastating blow), springing up of quality schools, hospitals, malls and retail and entertainment infrastructure. Buying a home very far from city limits can work well for very patient investors — you don’t need the money back for many, many years but usually for less endowed individuals, looking for an option that’s closer to or within city limits is a safer bet as an exit will likely be much easier, earlier.
The other lesson from this illustrative example is that you should not get wedded to your home.
If selling and moving seems the right and sensible thing to do, so be it. It also gives you an opportunity to not make the same mistakes while doing up your home again.
Former Editor, Outlook Business and Executive Editor, NDTV Profit, the writer is a personal finance expert. Mail him at propertyplus@thehindu.co.in
