Buying a home is every person’s dream and it is also a great investment that allows you to buy low, invest slowly, and sell high if needed. However, timing your purchase well is also a very important factor to consider when buying a home. It just so happens that the post-pandemic time may be the best ever to invest in a home. From the macroeconomic factors such as a fast recovering economy to micro factors such as businesses starting to recover through increased spending, this is the best time in the last decade to buy a home.
In this article, we take a look at the most important factors you should consider to know whether you are ready to buy a home this year.
Are you financially ready to pay a Home Loan EMI for the next few years?
The most important question when planning an investment or purchase is the financial one. A home loan is a great way to make sure you can afford a house. Before you take out one, be sure that you have enough money saved up for the down payment and monthly payments. It’s important to live within your means so that your future is not burdened.
Do you have enough savings for the down payment?
One of the biggest hurdles that people face when buying a house is saving up for the down payment. It can take years, but it’s worth it in the end!
It is always a wise decision to know how much savings you will need to pay for the down payment. Analyze your total savings and accordingly decide if you have enough money in hand to make that choice.
Your down payment should be at least10-20% of the price of the house. This will ensure you have enough money to cover unexpected expenses during the home buying process.
Are you financially ready to commit a part of your income to home loan EMI payments?
Buying a Home is not only a financial decision, it’s a commitment. If you’re unsure about whether you’re ready to buy a home, try setting aside a fixed amount of money every month in addition to your monthly rental to get used to the responsibility of making payments every month.
We’ve created a EMI calculator that provides you with an idea of how much home loan EMI would cost. You can use this calculator to get an estimate for the total home loan amount, monthly installments, and interest over time.
You will need an emergency fund with at least three months’ worth of living expenses saved up just in case something goes wrong.
For the sake of your financial security, you should consider starting an emergency fund. If something unexpected happens it’s good to be prepared. You should have an emergency fund with at least three months’ worth of living expenses. These funds will help you deal with unexpected events that may occur in the future, such as a job loss or getting sick.
And last but not the least…are you financially stable? You don’t want to buy a home if you’ll be missing payments on another bill.
If you are clear on the basic financial question asked above and feel that you can financially afford to make progress, then let’s move ahead to the next big question you need to think of when planning to buy your home.
Have you identified your family’s needs in their new home and have found the best home for them?
It’s not just about the numbers when it comes to house hunting. Home ownership requires more than just the ability to fulfil financial obligations. It also needs an emotional commitment to making it work.
Buying a home isn’t just a financial decision that affects you alone. It makes a difference to your family’s future too. You will be living in this place probably for your lifetime so you want to be sure that you and your family will enjoy life in your new home. You need to be prepared to commit to owning a home for the long haul because it’s not always easy to build or buy a second home once you’ve bought your first home.
There are many things to consider when buying a home but the most important are your family’s current and future needs. There may be times when the family needs to remodel or update the home to better suit their needs. In order to make sure that your home meets the needs of your family, it’s important to plan ahead and know what you want. Over the years, there will be multiple life moments such as births in the family, weddings and inclusion of new family members. The needs of your family living in your home will change. You should keep all these factors in mind when planning the type of house you want to buy.
Will your parents be staying with you when you move into a new home?
Are you planning to shift to your home with only your spouse and kids or are your parents also going to join you in your new home? The answer to this question will help you better decide the type of home you look for.
If the answer is yes, you might look for a place as per their comfort for example, preferably on a ground floor so that your parents may be spared from the hurdle of climbing the stairs.
If not, your preferences will change accordingly.
Do you have guests very often staying in your home for short or long durations?
Deciding on this question is very important as it will help in the final decision of the type of home you look for. There might be cases when you have guests staying at your place for long periods of time. In such cases, you would want to provide them with proper accommodation and comfort.
Even if you have guests frequently coming over to stay with you even if it is for a shorter duration, you might find the need of having a spare room in your home for them.
Do you plan to use your new home as a place of business and also as a place of residence?
It’s good to look for a home that can double as both your personal residence and place of business.
In addition to your home, you can use your new business property as a place of work and residence. This is great because it allows you to get both benefits under one roof!
As a business owner, you need to consider using your home as an office. This will allow you to save on rent and utilities while also having some privacy.
Do you wish to rent out a part of your home to also create a rental income and help pay the home loan EMIs?
Remember: just because you can afford a four-bedroom house right now doesn’t mean that you should buy one.
Also, you might consider renting a room in your house to a tenant. It’s not that difficult to rent out a room in your home. You can easily earn money by renting out extra space to people who need a place. You might want to consider this aspect too before finalizing your home as the rent might help you in paying your EMIs.
Buying a Home is a very important step in securing your family’s future
Buying a home is very important because it helps to guard your family’s future. Owning your own home provides stability and allows you to build equity over time. It is a place your family can call their own and it will remain as a long-term asset. Homeowners anecdotally have more net worth than non-homeowners. Homeownership is something everyone should strive for to help build financial security.
Consider all the important factors above when choosing to buy a home this year. Also, discuss with your family and those in your close circle and try to come up with questions that we may have missed out on!
Of all the things to consider, the financial part need not stress you out. Reach out to our customer care advisors on 1800-258-2225 and connect with your local Shubham branch. Our Loan Officers will help you assess your financial readiness for a home loan, and also help you with advice on your current and future options.shubham