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View Poll Results: Do you believe in owning a holiday home anymore?
Yes 59 23.60%
No 191 76.40%
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Old 19th August 2017, 15:23   #1
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Default Do you believe in owning a holiday home anymore?

Sample Airbnb house you could rent in Panchgani for 3.3k / room / night (link):
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In the last 5 years, we've witnessed significant changes to the economic, infrastructural & technological landscapes. And that's affecting our choices in a big way! For instance, most BHPians agree that a club membership no longer makes sense - related thread.

Just as Uber has rendered the 2nd or 3rd car of a house useless, I feel airbnb.com is doing the same to holiday homes. Why own & visit the same house every time, when you can rent & experience new places over holiday weekends?

Do you believe in owning a holiday home in 2017? Frankly, I don't. Reasons:
  • Maintenance, paperwork, recurring payments, taxes, insurance etc. Owning a 2nd home takes up a lot of time. We own a holiday home in Deolali and whenever we go there, the first day is only spent in cleaning & upkeep. That's not how I like to start my holidays!
  • Variety. Better roads & infrastructure have opened up a plethora of location opportunities. Why drive to the same place & live in the same house over & over again when you can try out new stuff?
  • Cost. Unless your holiday home appreciates significantly, it's cheaper to rent. Based on what I've seen in MH, only 1/3rd of holiday homes have enjoyed meaningful appreciation over the years. Most values have gone up unremarkably, while a few have actually lost $$$.
  • Convenience. Rent a good bungalow and you are welcomed into a clean, well-maintained place with all the right amenities + support staff. Check in, enjoy, check out. Of course, due diligence is required and I do read up reviews before selecting. As a result, the houses I've seen are top class. And it only makes sense as the host is running a business. There's a professional approach that a casual home owner simply won't have.
  • Capital. No EMIs, no down payments, no capital locked in on an asset you'll see 5 - 6 weekends a year.
  • Affordability. In popular places like Lonavla, Pawna, Mahabaleshwar & Goa, a fancy holiday home can easily cost 1 - 3 crores. Not everyone has crores lying around for a discretionary investment. However, the same people can easily pay 3 - 5k / room / night and live in a home of equal standard.

Of course, buying a holiday home makes a lot of sense if you visit the place frequently. But if you're a casual tourer like most of us, renting has replaced ownership. I want to put the Deolali house on the block, but Mom has sentimental attachments to it.

Want something plusher? Try weekendplan.in:
Do you believe in owning a holiday home anymore?-4.jpg

Or Kinos @ Pawna. Such a place will cost 75k - 100k a month in maintenance. You can enjoy it whenever you want to for a fraction of that:
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Do you believe in owning a holiday home anymore?-6.jpg

Related Thread: Hotel vs Home vs Homestay

Last edited by GTO : 19th August 2017 at 16:55.
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Old 19th August 2017, 16:56   #2
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Default Re: Do you believe in owning a holiday home anymore?

Thread moved from the Assembly Line to the Travel Section!
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Old 19th August 2017, 17:11   #3
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Default Do you believe in owning a holiday home anymore?

Nice thread. Honest opinion is that it is pointless owning a holiday home. As rightly penned, it's just too cumbersome to own and maintain one. In the app world that we live in anything is possible. For example the deals we get on 5* hotels and resorts were unthinkable say 5 years ago.

I have even avoided buying holiday time shares from Club Mahindra et all. I just don't find it worthwhile to stay in the same kind of properties and the same category on every trip. They are probably the biggest rip off. My friend can never get reservations on the dates he wants to travel. He always ends up booking another resort.

Yes Airbnb, make my trip etc have really made the holidays a lot cheaper and a lot more convenient.

I have a farm house which I recently renovated and that's about the only other place I visit frequently as I have an agricultural hobby.

Maybe at this point you should have your mom have it her way. After all sentiments have to be respected. Maybe another holiday home won't be bought.

Last edited by Arjun Reddy : 19th August 2017 at 17:19.
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Old 19th August 2017, 17:16   #4
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Default Re: Do you believe in owning a holiday home anymore?

I have voted "No" and totally agree to the reasons that you have already mentioned.
In addition to them, I feel with nuclear family setup + increasing disposable incomes + very less time on hands to manage or plan routines etc - there is an increasing propensity for people to outsource or rent almost anything but not own.
This outsourcing includes asking travel professionals to suggest an itinerary, places to visit, financials etc. And there's competition too in the travel services market.
So with every aspect of a good travel or vacation - be it the actual costly home, inconvenience of upkeep and the variety angle - the ownership index of a holiday home or weekend home is going down definitely.
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Old 19th August 2017, 17:26   #5
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Default Re: Do you believe in owning a holiday home anymore?

I personally don't see a reason to pick up a second home.
In my view, there are better bets than real estate out there - purely from an investment criteria (unless of course you see scope of appreciation & income coming in).
I shouldn't say this as I work for a developer, but that is my view on it - especially in a city like Mumbai.

This however, is me speaking as a younger generation. I would rather go to different places, and explore as compared to just be in one place.

My elders though would prefer a nice holiday home - a place they can escape to at the drop of a hat, with assured privacy and maintenance and service. But that too only makes sense if one can frequent it often.

We too have a house in Pune that we used to go to often, but with the way Pune has developed over the last few years - our visits have been minimal, with us only going when we need to go for some work.
I'd rather dispose of it, and get a more practical holiday home - but something that is interesting and makes me want to go there often. The dream is a place that has an ATV track, Paintball, organic garden, and possibly a car museum
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Old 19th August 2017, 18:42   #6
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During my childhood, we always used to spend our summer holidays at our village. So having a second home seemed like a good bet as we never got bored visiting the same place. We also liked that it felt like a home and not a hotel. We didn't even have a TV, but never felt bored because we had stacked it with books and board games which is how we spent all of our holidays, away from the summer heat in the lap of Himalayas. This is the only home my father built and we always lived in employer provided accommodation in the city.
Now, since I have decided to move there permanently and try my hand at farming, I thank my father for building and maintaining this house instead of buying one in the city, even if it was one of the best cities in India (Chandigarh).

I have similar plans of owning a beach property for similar reasons, but I won't be burdening myself by taking a loan for it. I'll only buy one if I can save for it. Also if I do end up owning one, I would be spending at least 2-3 months over there, especially in winters.

Sure, it is just a dream right now, but I want to shape my life and my work in such a way that I can make this dream come true and enjoy the fruits of my labor while I can.
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Old 19th August 2017, 18:54   #7
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Quote:
Originally Posted by Arjun Reddy View Post
..........I have even avoided buying holiday time shares from Club Mahindra et all. I just don't find it worthwhile to stay in the same kind of properties and the same category on every trip. They are probably the biggest rip off. My friend can never get reservations on the dates he wants to travel. He always ends up booking another resort. ...........
I agree with you that time shares are a big rip off. Unless you are in a position to plan your vacation a good four months in advance, it is difficult to get a booking at a destination of your choice.

Further, at most destinations the resorts are located away from the nearest town. As a result, the guest is compelled to eat at the resort itself at exorbitant prices.

Having said that, Club Mahindra does have some great properties and with some planning, it is possible to beat the system and at the same time enjay the local cuisine.

We have been twice to the property at Cherai, which is located across the road from the beach. On both occasions, we have not used the room service or in house dining. Instead, we have walked down the road and eaten at the loacal beach side restaurants or taken a auto to the nearby town for a fine dining experience.
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Old 19th August 2017, 20:50   #8
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Default Re: Do you believe in owning a holiday home anymore?

If the decision to own a holiday home is based on emotional or lifestyle reasons, then it does not make sense - thanks to AirBnB. However, if the decision to own a holiday home is based on purely FINANCIAL reasons, then it still makes sense. Let me explain -

Your networth = Fixed Deposits + Equity (stocks or value of own business) + Real Estate

If your real estate exposure is less than 33%, it still makes sense to buy a holiday home, with the following caveats -
  • You buy cash down, without taking loans. Interest you pay on your holiday home will kill your returns. This investment will appreciate by a minimum of 8% (based on historical long term inflation rate). If you are lucky, it will appreciate more.
  • You rent out the holiday home by listing it on AirBnB when you are not using it. Your holiday home has to earn rental income, without which it does not make that much financial sense. If you like AirBnB, why not explore the "other side" and rent out your holiday home? You might need to hire a trustworthy local to clean up the holiday home, before handing it over to a guest. But this expense will be negligible when compared to the rentals you receive via AirBnB.

I intend to do the above, but its not exactly a holiday home - it's an apartment that I intend to list on AirBnB, once the builder finishes the construction. Here is my logic -
  • I have poor exposure to real estate
  • I have booked a small 2 BHK apartment, cash down without taking a home loan (I save on home loan interest, and I can enjoy even small appreciation in prices over time).
  • Once the apartment is ready, I will get it furnished and list it on AirBnB. I have already noticed that the area has very few AirBnB listings. I intend to hire professionals (Housejoy app) to clean up the apartment before guests come in.
  • When the apartment is not occupied by guests, I will use it on weekends as a 'holiday home'. It's a 6 acre property with swimming pool, lawns and 80% open area. The kids will have a good time here (I stay in an 'independent house' with very little open areas for kids to play)

Next year, I will let you all know my AirBnB experience - as a host!

Last edited by SmartCat : 19th August 2017 at 21:00.
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Old 19th August 2017, 21:48   #9
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Hi smartcat, if its not too much, could you tell us which project this is and where? Sounds interesting with the 80% open space.
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Old 19th August 2017, 22:19   #10
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Default Re: Do you believe in owning a holiday home anymore?

Quote:
Originally Posted by smartcat View Post
I intend to do the above, but its not exactly a holiday home - it's an apartment that I intend to list on AirBnB, once the builder finishes the construction.
Will the resident association allow such a use? Regular rentals are different as you have people coming in for a longer term (11 months and over). Even in that case, some associations insist to get the tenant acquainted with the members initially.
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Old 19th August 2017, 22:59   #11
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Quote:
Originally Posted by Dry Ice View Post
Will the resident association allow such a use? Regular rentals are different as you have people coming in for a longer term (11 months and over). Even in that case, some associations insist to get the tenant acquainted with the members initially.
Based on my research (Google search, Airbnb hosting community forum etc), some apartment associations do make a fuss about this issue. But I do see lots of apartments listed in Bangalore on AirBnB. If I have issues with my apartment association, no rental income for me (bad luck) - but I still have an asset that appreciates in value and I can still use it as a 'weekend home'.

But I know for a fact that apartment associations in Bangalore have little time for policing when they have more pressing issues like -

- Getting 24/7 water supply
- Getting all owners to pay maintenance charges on time
- Hiring a reliable manager who can handle security & cleaning staff
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Old 20th August 2017, 08:52   #12
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Default Re: Do you believe in owning a holiday home anymore?

I think ownership of assets as a concept is already seeing a sea change. Today we see enough affluent people who are very happy to lease even if they could afford to buy the house they live in. For a variety of reasons. If that is a trend with your primary home, it is undoubtedly a sound reason in the context of a holiday home. Enhanced much more for additional reasons such as time and money to maintain that house, the administrative supervision etc.

I can only off hand think of some of these limited examples and reasons where someone could choose a holiday home:

- the Ultra HNIs who would not even notice the blip in their net worth in the acquisition and maintenance of these homes. They want a completely personally customised lavish setting that is only their own. (think Shah Rukh in Dubai or many rich promoters in India who have such homes).

- People who spend 3 months a year in such a place which is truly their primary home for part of the year and not just a holiday home (certain people live in Goa or similar places where their professions allow for 2 - 3 months a year)

- Wealthy people who may stay out of such places for 2-3 days per week (again - I know some wealthy professionals who can do that out of Mumbai.) It again takes a unique set of circumstances for this to be possible given that if you have growing kids they come with their own requirements that make leaving a city difficult for a parent.

But for a pure occassional holiday home - its Airbnb (and similar) for sure all the way. You can get access to any property without locking capital instead of the same property (or set of properties if you do a Mahindra type setting) when you choose such rental options.
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Old 20th August 2017, 09:36   #13
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Default Re: Do you believe in owning a holiday home anymore?

Holiday home makes a lot of sense if you have a specific lifestyle in mind, fond childhood memories or certain hobbies to pursue. In this case your goal is not variety or creature comforts but nurturing a certain lifestyle that is close to your heart for mostly sentimental reasons (not financial). Of course, assuming you have limited finances

Contrary to the popular opinion, I don't like what AirBnB did I used to get very lucky with my holidays before AirBnB, tripadvisor, google maps etc. because I had a technique of searching for very hard to find boutique/homestay type of places. My sources were typically blogs, travel forums, Flickr photo streams, etc. and in the absence of Google navigation, it was hard to locate and drive to the place. The wow factor you get if you haven't seen the photos or read other's opinion is priceless. But now all these places are not only easily discoverable and accessible, but took away the entire charm of such holidays and reduced them to "cheaper than resorts" value proposition. Owners of such places are busy working on marketing, increasing online ratings, false or exaggerated advertising, etc. Not to mention mushrooming of such places that completely kills the boutique nature. There is absolutely no element of surprise in such holidays these days - which is exactly why one would go to a resort (to avoid surprises). Sorry about the rant but it has become impossible to have a holiday that you can't "preview/over-research".
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Old 20th August 2017, 10:07   #14
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Quote:
Originally Posted by smartcat View Post
You buy cash down, without taking loans. Interest you pay on your holiday home will kill your returns. This investment will appreciate by a minimum of 8% (based on historical long term inflation rate). If you are lucky, it will appreciate more.
I have done something like this. I first bought a plot of land 5 years ago in Konkan. Then after couple of years built a small 2bhk house on it. Have planted some mango, beetlenut, and cashewnut trees. I did this in stages as and when money was available. I did not take any loan. I have a person who takes care of the house at such nominal rates that one can only dream of in the city. I rent it out to my office colleagues or friends when I am not using it. I guess I should be putting it up on AirBNB too.

The best part? The value of the property has more than doubled in 5 years.

This works only if you buy a plot and build a house the way you want. The value appreciation isn't much if you buy a holiday home in a planned society. I consider that a ripoff.

Last edited by GTO : 20th August 2017 at 13:13. Reason: Trimming quoted post
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Old 20th August 2017, 14:06   #15
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Once upon a time, it was my dream to have a Farmhouse in the outskirts of the city, with lots of greenery and few farm animals. Fortunately, it never happened and today, Iam glad that I saved myself a lot of time, money and energy.
Some of my friends who have farmhouses / weekend holiday homes rarely visit them. Expenses for upkeep outweighs the rewards.
Stories of land grabbing from neighboring villagers and land owners, corrupt local authorities, thieving staff, loss of locally grown produce and difficulty to sell such a place (though on paper value has doubled or tripled) are just a few things which kept a urban guy like me from owning a holiday home.
Makes a lot of sense to hire. So many options on various sites. Travelers ratings, pictures and GPS navigation has made traveling easier.
Another site, which I came across though have not used it as yet is www.couchsurfing.com
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