Manish Kothari is an investment banker, and his wife, Varsha, a financial analyst. Together, they own a house in Mumbai's Mulund area. Recently, the Kotharis bought another property in Ghatkopar, "for the purpose of investment," says Varsha. "We made the basic down payment and took a loan for the rest. We plan to put the place up for rent and are treating it like a longterm investment," explains Manish.

UP NORTH

"In the NCR, couples are lapping up houses anywhere in the range of Rs 35-80 lakh," says Raminder Grover, CEO (residential property) Jones Lang Lasalle Meghraj. "With home loan rates going down, it's definitely a good time to buy that second house. But if you're looking at another property as an investment, you must remember that the returns will only start coming after a period of 48 months. If someone is willing to factor in that gestation period, they should go ahead and buy." Grover says sectors of Gurgaon (Rs 2,300-12,000/ sq ft), Noida (Rs 3,000-7,500/sq ft), Ghaziabad (Rs 1,800-3,500/sq ft), Faridabad (Rs 1,800-3,000/sq ft), Manesar (Rs 2,400-2,600/sq ft) are prime areas to buy property in the NCR.

Doctors Sanjay and Anuradha Chugh bought a three-bedroom villa in the Candolim area of Goa last year. "When it comes to real estate, Goa is the hottest investment destination in India today. We take off to Goa at the first given chance. The villa has appreciated considerably since we bought it a year ago and things can only get better," says Sanjay Chugh.

HOMEWARD BOUND

Planning to buy a second home as an investment? Here's a checklist:

• Track the suburbs. Keep an eye out for articles on highways being built, houses are bound to follow

• Make a field trip to the property. Invest in a property that is coming up; it will have appreciated by the time of completion

• If you're planning to rent the place out, it is better to buy a smaller, highend apartment rather than a larger middle-income level place

• It's safest to rent your house out as a company guest house on an 11-month lease with an escalation clause that factors in a 10-15% annual hike in rent. Providing basic furnishing and white goods make the rent shoot up

• Take 10 months advance rent

• Commercial properties give a better rate of return (10-15%) as opposed to residential property (5% if you're lucky)

WESTSIDE STORY

Mumbai-based Chetan D Narain, president of the India Institute Of Real Estate, feels rates in mid-town Mumbai areas such as Prabhadevi, Worli and Bandra are already at a high and will continue to rise further. "Investing in these regions will not fetch a good rate on rental returns. Areas such as Malad, Borivali, Ghatkopar, Vikhroli and Mulund have the most feasibility in growth as of now," says Narain. If you're looking to buy a place in any of these areas, you may have to shell out anywhere from Rs 4,000-6,000/sq ft in Ghatkopar, Vikhroli and Mulund and Rs 5,500-7,500/sq ft in Borivali and Malad.

Narain is also clear that the `gestation period' must be kept in mind when looking at a house as an investment. "The purpose of investment has to be well defined. If it is long-term investment with a seven to 10-year horizon then, yes." Narain predicts that a correction for over-priced properties is round the corner. "Prices will stabilize and flatten out between Juhu and Borivali," he says. The story in South Mumbai, though, is slightly different. "It's a stalemate there with every seller starting their prices around Rs 60,000/sq ft. People latch on to the `top end' price for their mid-range properties, making the problem worse. I strongly feel that people must look at correcting their prices and that brokers must guide their clients/ sellers about the right valuation based on logic, plus a reasonable premium," he advises.

GO SOUTH
EASTWARD HO!