To buy or not to buy – does this dilemma haunt you?
Here are five reasons why you should not delay stepping into your dream home.
Cheaper loans: The recent 25 basis points (bps) cut and the 125 bps slash last year in the repo rate by Reserve Bank of India (RBI) effectively translate into a discounted home loan burden on your pocket. Some banks like SBI and ICICI already reduced the rates to 9.40 per cent (for women) on switching to the marginal cost of lending rate (MCLR) benchmark system this month.
Real estate downturn: The unsold housing units to the tune of seven lakh in September last year and the depreciation of the projects by 10 to 15 per cent have already jolted the real estate market. The rising labour costs and the expected increase in demand because of the aspiring youth migrating to the cities make it unlikely that the dream run for the buyers would continue for long.
Women empowerment: There is every reason you should own your home since you get a concession of 0.05 per cent on the lending interest rate if you are an applicant or a co-applicant.
The Real Estate (Regulation and Development) Bill, 2016: The Bill recently passed by Rajya Sabha bars builders from diverting your hard-earned money to other projects. In case of derailed possession dates, you can get your money refunded along with the due interest.
Money-saver: You save on rent. Moreover, you get a rebate on the interest you pay in your EMIs.
All said, buying a house is still a daunting task since it is a life-long asset involving huge investments. Here are the important things you should keep in mind while taking the final plunge:
When buying the house:
Remember that the discounts and gifts are a trap to lure you. Moreover, the basic price of the house that is advertised is significantly lower than what you are supposed to pay. Ask for the break-up.
Make sure that you pay for the carpet area of the house. Do not end up spending on the super-built up part that includes the common amenities like corridors, club houses and parks.
Verify whether all the permissions are in place like the project registration, layout approval, mutation and diversion consent, and, environmental clearance.
Read the agreement and other legal documents carefully before signing. Get it checked by a professional for hidden terms and conditions that you may miss.
When entering the loan agreement:
Visit the RBI website that offers a detailed insight for the home buyers. Clarify the unfamiliar terms and riders in the loan agreement before going ahead.
The bank representative may insist on lending you a combo insurance plan. However, it is expensive and some of the benefits would disappear by the time you get the possession if you are buying an under-construction house. Your priority should be to insure the loan.
Last, do not forget to bargain. In this age of coupons and cash-backs, discount is inevitable. Your game of patience begins, now!