India, June 26 -- Rajiv Sharma, a 38-year-old IT consultant in Chennai, owns a 2BHK flat in Velachery. He's torn between selling the flat for Rs.85 lakh or renting it out for Rs.22,000 per month. The flat is fully paid off, and he currently lives in Bengaluru for work. While renting would give him a steady second income, he worries about tenant issues and maintenance from afar. On the other hand, selling now could help him invest in a new property near Bengaluru, but he's unsure if property values in Chennai might rise further.

In India's Tier 1 cities, net rental yields typically range from 2-3%, while capital appreciation in developing areas has averaged 6-8% annually over the past five years. Rental income offers steady cash flow, whi...