It is an once-in-a-lifetime decision for most people to buy their own house. Because it takes a lot of financial commitment and time, home-buying requires a lot of research and understanding of factors like home loans, real-estate pricing in different areas, budget, etc. The long and tedious procedure right from choosing a house to moving into it entails a lot of legwork and ups and downs beyond your control. Here are a few points to keep in mind when deciding on a home to buy:
Do your homework
It is advisable to do enough research and homework on the areas that you’re considering for buying a house. Housing prices vary from one area to another. In addition, there are other considerations like amenities in the vicinity, commute from the place of consideration to your workplace and/or your kids’ school, transportation options near the property, etc. While the pricing of the property is definitely the primary factor, these other considerations also need to be factored in before you can zero in on an option. Getting an affordable and beautiful house with a safe locality is desirable. But, in the bargain, if you end up compromising on a convenient mode of commute to work daily, then the deal is hardly worth it. The idea of living in your own house does not only entail coming back to your family in your own private space; it also means getting enough time to spend with your loved ones and engaging in your personal errands and activities after work.
Stick to your budget
Real-estate sites always highlight the most attractive aspects of different properties. It is never just about the apartment being a 2BHK, 3BHK, or a penthouse, nor is it only about how far the city airport or major railway junction is from the said residential community. Marketing a property, today, goes beyond these practical considerations. When you look up the various websites on real estate, you will notice how much each property listing talks about the premium amenities on the premises. Especially in the case of high-rises in upscale areas, such as residential apartments in Bannerghatta Road in Bangalore, the sites will dedicate a major content space on facilities like a swimming pool, an infinity pool, a badminton or tennis court, kids’ play area, gym, etc. Whether or not these facilities are of any use to us, many a time we find ourselves getting drawn to these options, with the result that we end up contemplating buying these apartments, which most likely exceeds our budget. While it is a good thing to dream big, but being a little grounded will save one a lot of heartache, considering that an upscale property means a high down payment, and costly EMIs. It is only wise to set a reasonable budget and stick to it, no matter how attractive other options seem.
Steer clear of pre-EMI
Buying your own home is a decision of a lifetime. While getting your own home is a self-esteem-boosting development, it comes with a heavy baggage of financial commitment, and more so if you’re taking a home on EMI. In this case, it is wise to go for a house that is ready to be moved into, instead of an under-construction property. The primary reason for this is that your EMI starts getting calculated as soon as you sign the papers for purchasing that property. When it comes to an under-construction property, in most cases, the home-loan borrower has to pay pre-EMI on the partially drawn loan. And, neither is the pre-EMI tax-benefitting nor does it reduce your outstanding amount. And, once you have moved into the house, you start paying the EMI. Effectively, you end up with a longer and more costly monetary commitment, which defeats the purpose of taking a home loan in the first place. In such a scenario, it is better to invest in a ready-to-move-into house and pay your EMIs and principal on the pre-determined dates and get done with them.
Home loan before the home
If you’re serious about buying a house sometime soon, it would make sense to first hunt for lenders of home loans. Getting a home loan is replete with heavy documentation procedures and paper works. Instead of opting for a home loan after you’ve chosen a house, you could go the reverse way. A pre-approved home loan is a good option, provided you are vigorously hunting for a property. The primary document when applying for a pre-approved loan is your income-related documents. This is to check for your creditworthiness. Also, you are expected to find a house within the stipulated validity period set by your lender. In the case of a regular home loan, the documentation also includes property papers for the lender to verify. Only after the lender is satisfied will he decide on disbursing the loan amount. The turnaround time is much longer in the case of a regular home loan, as compared to a pre-approved loan, which makes it much smoother to get your principal amount and gears up the house-hunting process for you.