Due to the Corona epidemic, many people lost their jobs and some people could not achieve their financial goals this year. In such a situation, this epidemic is like a wake up call. The corona epidemic has forced people to plan their savings and investments in a better way for a more secure future. In such a situation, the youth are also thinking of making financial assets as soon as possible, that is, they are now thinking about it in some time after the start of employment. Apart from this, the trend of working from home is now permanent in many companies, so buying your first house or buying a bigger house than the present has become a practical option. However, buying a house is a very long process and it requires financial discipline and commitment. At such a young age, it is right to start planning as soon as possible to make your home dream come true.
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For these reasons, buying a house at the age of 25-30 is better
- The real estate industry is currently offering many offers and schemes to woo home buyers for the first time. Apart from this, there are many options of small size and affordable house at this time.
- Most financial institutions and lenders are offering home loans at very cheap rates at this time. Apart from this, banks are also offering some such offers, which have increased loan repayment and flexibility in their contribution. Due to this, the process of buying a house has become much better. Recently, stamp duty has been cut and tax benefits are also being received, which has increased the attraction for buying a house.
- Typically rentals are charged at around 2-3 per cent of the property value, while home loan rates are close to 7 per cent. 2-3 years ago this difference was above 6 per cent. In mathematical terms, it is still better to rent an apartment than to buy a property when the price of the property is increasing at a rate of less than 5 percent per annum. However, if the resale value of the apartment does not matter, then this is the best time to buy a house in the last two decades.
- Some lenders provide loans for a maximum tenure of 25 years, but some lenders also give up to 30 years. Due to more tenure, each month’s installment will be reduced. If you are 25 years old or 30 years old, you will get less EMI if you take a loan for a longer period and it will remain affordable. Although the total amount to be paid becomes more by keeping more tenure, in this case, this decision should be taken carefully.
- If you are thinking of buying a house for a longer period, then see if there is an option to start a repayment with a lower EMI and also see that the EMI can be increased to the best of your ability as time goes on. Yes or No. This will give you the convenience of buying a big house today according to the needs of the future.
- If a bank is offering a subvention scheme, till the house is not found, you will not have to worry about filling the EMI. In the beginning, this option gives a lot of relief but for a long time more EMI may have to be paid. In this case, it is necessary to have the necessary balance in the cost of the house and EMI.
- Preparing a financial asset like home provides better security against any future uncertainty. Apart from this, it also provides second income as rent. This motivates the youth to spend their money according to need, that is, if the youth buy a house, then the amount spent in repaying the home loan installment will strengthen their future.
(By Manish Shah, MD & CEO, Godrej Housing Finance)
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