Rs , sq ft

Removed from Shortlist

My Shortlist ()
Keep track of your shortlisted properties here. Shortlist a property to get started.

Is buying a flat really a gain as it appears ?

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.

Am I missing anything here?

Reply

Replies (2)
1
hi satish..You are missing profit from Rent, Income Tax benefits and inflation too.
Ravindra Singh


2
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.
Sudhakar


3

Ask a Question
120 Characters Left











    CommonFloor Property Search Mobile App now available on Android, iOS and Windows!