Tips For Key To Your Dream Home

Whether you are a first time property buyer, buying a second home or an expert real estate investor, buying a home is a one of a kind experience. For many owning a home gives a sense of pride and security and for many others it is one of the most significant investments of their lifetime.

The boom in Indian real estate is not only observed for domestic property but also the commercial sector. Whatever maybe the case, the pace at which real estate is growing in India, every one of us wants to be a part of this phenomenon.

Things to know before buying a house

If you are a first time property buyer, this article will put forth a checklist of things that you should verify before buying. For second-home buyers or real estate investors, this article will be a guide for property buying or investing in real estate. Following are important factors to look out for before buying a property to minimize your risk.

• Budget: First and foremost you need to assess your affordability. Check how much money you will need to run your monthly expenses. The remaining amount of money is what you can set aside as investment or EMI for your dream home. Remember, that this is not going to be your first and last property purchase. So be sure of your long-term needs as well.

• Location: Identifying a suitable location is one of the most important tasks of buying a property. It is always advisable to look for a property adjacent to a prime location, as the price of the property might be comparatively lower however, accessibility to prime areas of your city will not be an issue. Location will also have a significant impact on the resale value of your property. Choosing a location wisely will reap good benefits on your investment.

• Rental rates in the area: If you are investing in a property for future renting, homes in high-rent or highly populated areas are ideal. Knowing the rental rates in the desired area will help in choosing the right property and location.

• Good Resale Value: Resale value of a property is a factor to be considered before planning to invest or buy a property. As a property buyer we primarily focus on locality and the budget, however, if you choose a property in a wrong location without doing adequate research your property might not reap you the desired resale value in the future.

• Loan eligibility: Home loan eligibility depends on the repayment capacity, income, existing loans or debts and the age of the applicant. These days there are a lot of online financial portals that are equip with a loan eligibility calculator to help calculate the loan eligibility and EMI of the home loan borrower. The loan sanctioned may vary from bank to bank and the bank or the RBI regulations may decide on the eligibility criteria. As home loan rates are on a steady rise, the loan eligibility for a borrower is becoming stiffer by the day.

• Stamp Duty & Registration Fee: These fees are as important as the income tax or sales tax that we pay to the Government. While assessing your budget please take into account these overhead charges that may vary from city to city. To know the market value of the proposed property and the stamp duty charges that might be applicable you can refer the Ready Reckoner guide to locate your valuation zone and sub-zone. Then find out how much stamp duty is applicable as per the market value.

• Additional Costs: Please keep in account that there are many middlemen who help you buy your desired property. These intermediaries can be your real estate agent, lender, home inspector, land surveyor, lawyer etc. These costs should also be factored into your budget. Apart from this, some of the other expenses can be maintenance fee and extra charge for parking.

• Connectivity: Connectivity of your property with major location plays a vital role in boosting the resale value or rent value. Ensure the property is located in an ideal area with good connectivity to the bus station, railways station, airport and super market etc.

• Neighborhood Amenities: When searching for a new home, we usually factor in location, price and layout. Nevertheless, Neighborhood is one of the most important factors to take into account. While making a list of amenities, include the proximity to schools, hospitals, banks, shopping malls, restaurants, entertainment centres and parks into consideration.

• Traffic in Peak Time: Some areas or localities in the city are prone to traffic jams and bad roads. Working professionals or tenants should try to avoid such locations. The best way to find this out is to take a tour through the locality during peak traffic hours and get a feel of the neighborhood.

• Research about builders: There are a lot of question that a property buyer should ask a builder. The more you know about the builder, the happier you will be with the final product. As a buyer, you should research and verify the reputation of the builder or developer. Look for their previous projects and enquire with the homeowners. Ask for a copy of the plan approval duly stamped by the municipal authorities. The developer is allowed to make changes in the proposed plan but even that should be approved by the authorities and property buyers.

• Property insurance: Insuring your property is very important especially if you are planning to buy a property in a calamity prone area. This will safeguard your investment if there is any damage to your property in the future. The cost of insurance is relatively low; however, it provides financial cover in case of a problem with the property title, damage or any legal issues. There are many types of home insurance policies to choose from varying with the levels of protection needed. Choosing the right House Insurance policy protects your property and makes your buying process easy.

• Tax Planning: Tax planning is a legitimate exercise and should not be confused with tax avoidance or tax evasion. Tax benefits can be claimed on both the principal and interest components of the home loan as per the Income Tax Act. You can also purchase property in joint names. Joint home loan is an option that might prove fruitful for married couples. Read your home loan document to know the tax benefit available.

• Water supply and sewage systems: While buying a property you need to consider checking the water supply and sewage or wastewater disposal approvals of the property. The state governments some times do not approve sewage or wastewater disposal system for some properties or locations. Also, check the quality of water that is available in the location. Before investing on a property, ensure the availability good quality drinking water throughout the year and civic body approvals for good sewage systems.

• Legal Advice: Be it construction, purchase, sale or lease of property legal advice is mandatory. Since property prices are, ever-increasing real estate investment is a very profitable form of investment. Real estate investment does not just mean buying and selling, you have to be aware of the laws that govern this business. It is always advisable to consult a legal expert before investing in property.

Buying a home is no longer just an investment. There are many people and their emotions involved. Do your research and take into consideration the points discussed above. Remember, your decision is the key for your dream home.