Q: Is buying a flat really a gain as it appears ? Look at the below example, Total cost of flat = 40 L (1000 sq.ft * 4000 rs) Home Loan taken = 30 L , EMI per month = 30K Period = 20 years Invest from our hand = 10 L ,
TOTAL BUY AMOUNT = 40 L
Now I want to sell the house after 5 years,
Now total cost of flat = 55 L (1000 sq.ft * 5500 rs)
TOTAL SOLD AMOUNT = 55 L PROFIT = 55 - 40 = 15 L
But during these 5 years EMI paid = 60 months*30K = 18L 15 L as interest and 3 L principal amount.
PROFIT - LOAN INTEREST = 15- 15 = 0
FINALLY THERE IS NO PROFIT MADE IN 5 YEARS FOR THE PROPERTY BOUGHT.
Hey Satish..i believe buying a apartment or flat is always a good investment...and specially in a metro city like Chennai...where market is showing immense growth with land prices and project rates increasing every year.