Deciding to buy a home soon? You might want to read this article until the end!
Home buyers in India are faced with several hurdles that if not skipped in time can cause the home possession really messed up. If you are going to make your first real estate purchase, these are some points of note, you must bear in mind, to make the transfer as smooth as possible.
You should also take care of the fact that between the time of you making the payment and getting the house registered to your name, there are several laws that operate separately for you, the buyer, the seller and the lender. Hence, prerequisite knowledge is a must.
We feel this is a mentionable point as most of the home buying transactions in India involve some amount of loaned money. If your loan amount makes up 25% or more of the total property value, you must choose the loan scheme very carefully.
It is advisable to consult a property broker or a loan officer who can guide you through various loan products available in the market.
In India, about a significant majority chooses the wrong loan plan for them. In some cases, people settle for the initial low rate of interest and sometimes they take the loan for too long a tenure. All of these mistakes can land you in wastage of money in future and can make it hard for you to pay off the loan as you plan to.
This might feel like an obvious fact but it is egregiously important to inspect the house once before finalizing it. In many cases, people try to pace up the transfer process in order to discourage you from inspecting the house thoroughly.
This can leave you in discomfort later on. If there is a fault with house’s roof, electrical wiring or drainage, it will continue to haunt you for a long because these are hard-to-fix problems.
So, make sure you inspect the house thoroughly. You may hire an inspector as well, who will make it a lot easier for you to peacefully finalize on your favorite home.
This is a big woe that comes in the shape of merry news. Sometimes, loan lenders or financers give you a green flag for properties that are evaluated at a much higher price than your ITR depicts.
You are bound to rejoice this situation and quickly sign-up in haste. But stop right there. Don’t underestimate your budget just because you are getting a bigger amount sanctioned. Calculate your income capacity accurately and settle for the EMI amount that doesn’t get in the way of your income.
For many people, the teeny bit of realtor’s fees seems like the most avoidable thing in the world, but it may become a loss of lakhs of rupees.
If you are a new to home buying, the realtor is your best friend. Realty firms help you at several stages of the deal. You being the buying party can’t rely only on the seller’s agent.
No matter what, at the end of the day, the seller’s agent will act for his client’s profit, which is why having a consultant at your end will help you dodge any petty trick being played on you from the seller’s side. This happens a lot in the real world and you must prepare for it nicely.
Do you plan to buy a property anytime in the future?
If the answer is yes, you are doing the wrong thing by waiting.
Making a real estate investment is indeed a critical thing!
Frankly, it takes away all your savings at once.
However, don’t you think the returns are worth it?
We have all faced the dilemma of planning but the constraints seem more binding every month. Again, the expenses increase, and they are always 10% more than the current salary. But, still we manage to save some and we manage a lot of things too.
You can not afford to sit back home unless it is making you big bucks.
See for yourself, how much renting even a single room earns you especially in a metropolitan city. Nowadays the paying guests, and there are so many other ways that house, your one-time investment makes you money.
Yes, obviously, it is a big investment to work.
No, my friend, you wouldn’t regret it anytime in the future.
On our viewer’s request after a recent post, Spacio Realtors bring you top 6 Reasons to buy a property before 2017 ends:
Whilst the prices keep on increasing, now is the lowest they can be anytime in the future. With all the development projects, new laws, plus, increasing population, what do you expect?
Even in the past, 95% of all the times, prices have only shown a straight rise
Reading ahead, you would know why will there be a significant one in the coming future.
Most of the real estate transactions were made in the form of cash prior demonetization. It is no secret how much black money influenced the business, on the top of which there was zero transparency. The banning of 500 and 1000 Rupee notes, came as a shock to all.
With demonetization coming into action, there is some decrease in the property prices.
You can check the property trends of Mumbai by clicking here.
Post demonetization, the demand dropped significantly creating a bigger room for negotiations. For obvious reasons, when the demand is bigger, you can not really expect the price to be dropping.
From 8.25 in 2011 to 6.25 in 2017, The Reserve Bank of India decided to keep the repo rate unchanged for the year.
To comprehend this better, you should be very clear about the investment made in Renting and purchasing, especially for the latter. You must have a very clear picture of how much basic investment i.e. liquid money you are required to have to make a purchase and how much will it cost you later including the hidden prices.
Property investment, especially in Mumbai, the city which has been on the top of the list for being the most benefit in terms of Real Estate investments.
You can check this research report to know how much growth potential Mumbai, and Pune properties hold.
And, for the matter of fact, we have seen some significant rise in NRIs looking to make property investments in Mumbai specifically.
Taking into consideration the many reasons there are, I bet, you will look back in a year and be thankful for the decision you made today.
Haven’t you heard about the GDP yet?
Indeed, it decreased in the recent past, but with the same government, it was more than expected in 2016.
Post demonetization, Income Disclosure Scheme 2016 and Make In India project, you can well imagine what is going on.
The purchasing of foreign goods became more expensive with the drop in the value of Indian Rupee, then the export price reduced.
Clearly, export is benefited!
In current fiscal, GDP dropped to 6.1%
Our growth rate is more than that of China’s!
Lately, we have been posting a lot about RERA on our blog.
Needless to say, that it empowers the buyers by bringing much-needed transparency in real estate transactions.
With the Real Estate (Regulation And Development Act), 2016, buyers can finally feel secure about their investment made.
Plus, it also obligates the builder to be more conscious about what he confirms and what he delivers to the investee.
You can read our post about, Rights of home buyers under RERA, where we have discussed the many ways buyers are
It is a major decision for everyone. So it’s imperative that the decision to buy property is well informed and adequately researched. More so, in Indian context, where the real estate sector is inadequately regulated and opaque.
As one start looking around without structured parameters, the confusion compounds.
Below are some major pointers on which one must deliberate before buying a property:
The first and foremost thing that one must be clear about is that purchase of property is for self use or pure investment. Because if the decision is, let’s say, for investment, only then the location or area doesn’t matter as much as the builder, delivery, scope of capital appreciation, rental values, hidden cost etc. matter.
The most obvious point to consider in any purchase is ‘What’s my budget to buy property’. Market is full of options. Before one goes out scouting, it’s important one has fair amount of clarity about the money one wants to invest in property as it would reduce confusions, impulsiveness and also help in sound financial planning.
After evaluating ones needs & desires, it’s important to limit range of area where one shall like to buy property especially if it’s for self use.
Once area is decided, one must now further short list the location by looking at it’s neighborhood (Slums is major issue in Mumbai) and infrastructure in terms of connectivity, safety, markets, school, medical facility and future development plans etc.
Both old and new construction have their own set of plus & minus in terms of quality, amenities and price. Also urgency of need is important factor in case one looks at under construction property.
It’s important to know who is the builder of the particular chosen property. It’s important to do background check of the builder because quality of construction and commitments depend on builders’ reputation. Reputed builders will always command premium. But that premium remains always attached to the property.
The type of project has lot of bearing in terms of pricing, infrastructure and neighborhood. Clear plot project will always command premium and is worth it.
Before making the final decision, one must look at the title of property and whether all Govt. approvals are in place. It’s always advisable to take a legal advice though it may have some cost.
Related Post: Documents required to buy a resale flat
Especially in under construction or new projects, delivery is an important factor. Giving a grace of few months, the property must be deliverable as per schedule. Delivery overrun also has adverse impact on cost of acquisition in terms of cost of funding etc.
One must ensure that funds to buy property are fully tied up and well planned.
Now-a-days, property developers are offering attractive schemes of payments. One must ask and check such schemes but ensure that they are genuine and not sugar coated pills which ultimately harm the buyer of residential or commercial property.
Buyer must read the property deal in detail and minutely to check it doesn’t have hidden costs and restrictions in term of maintenance, transfers, escalations etc.
It’s good to know beforehand what’s going to be recurring cost in terms of property taxes, maintenance and society rules etc.
Connect with one of our experts. We look forward to helping you with your real estate needs.