InvestorQ : Should I also evaluate the property based on the rental yield of the property? What are the general rental yields in Indian cities?
Maniish Lofar made post

Should I also evaluate the property based on the rental yield of the property? What are the general rental yields in Indian cities?

Answer
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Nisha Chandani answered.
1 year ago


When you buy property, there is a strong investment angle to it. As an investment, there are 2 things you need to consider. What is the rental value of a similar property? The rental value in most cities ranges from 3-4% of the value of the property per year. The higher the rental potential as a percentage of the price you pay, the better it is. Secondly, you also need to evaluate the re-sale value and potential of the property. You may always need to move to another city and you do not want to be stuck with an illiquid property, nor do you want to do a distress sale. Above all, you also need to ensure that you are not left with negative equity; meaning your loan outstanding must not be more than the value of the property.