Investing in a new house is among the most crucial life commitments. It involves years of planning and savings to make the final decision. Therefore, individuals must factor in certain aspects before purchasing their dream houses as per their requirements.
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As the entire process is complex and time-consuming, having a list of priorities will be helpful for both the buyer and realtor to compare and shortlist the options accordingly.
Read along to understand them in detail.
8 Things To Consider Before Purchasing A New Home
Before investing in your dream house, make sure to keep these top factors in mind:
Budget is a key game changer for most buyers when investing in real estate. If one knows how much one wants to spend on a property, it becomes easy to shortlist the options. One should always compare the price of the house with the neighbouring properties from several builders to ensure a genuine quotation. Moreover, one should determine how much one can spend on EMIs apart from the other monthly obligations.
The location increases demand, and demand raises real estate prices. Furthermore, financial institutions determine the principal loan amount depending on the location of the house. Therefore, a house with modern amenities, good construction quality and easy accessibility to the basic places is a profitable option.
- Resale value
Buying a house in a prime location with developments like metro stations, hospitals, freeways, schools, shopping malls, etc., in the vicinity will substantially impact the resale value of the house. Remember, the Return on Investment (ROI) depends on these factors.
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- Home loan
Having a house of one’s own is a huge milestone and an expensive affair. To supplement the budget for purchasing one, one can seek financial assistance with the help of a home loan. It will also help in increasing the budget for buying a property. Further, several lenders extend loans to buy ready-made houses and finance the construction from scratch.
However, home loans are available against long tenure of up to 30 years. In this period, a home insurance policy is beneficial to secure your house and belongings for which you have already invested a lump sum from any damage caused by natural calamities, fire, burglaries, etc.
- Additional costs
Often, when you see a posh property with modern facilities, you may finalise the deal without negotiating.
Therefore, besides determining the total cost of purchasing a property, one must take the total cost of ownership into account. It comprises furnishing costs, parking charges, maintenance costs, property tax and more, contributing to almost 5% to 20% of the property’s bare expense.
Hence, before deciding, a homebuyer should ensure that it fits the monthly budget to avoid straining finances.
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- Home insurance
Thefts, robberies, and burglaries cannot be entirely avoided or eliminated. Therefore, opt for property insurance against affordable premiums to protect the dream house from such losses. In addition, a home insurance policy will compensate for any damages caused due to natural calamities.
However, paying both home loan EMIs and policy premiums might be financially draining. In this regard, a home loan EMI calculator is a handy tool for managing one’s finances efficiently. One can estimate how much they need to pay as EMIs and choose house insurance against feasible premiums.
- Rental rates in the area
If one plans to invest in a rental property, choose a house in a prime or highly populated region. Remember, a property in a high-rent area is always in demand, ensuring sound rents.
Though each of the above factors ranks differently in significance for individual home buyers, all of them are worth examining to make the best purchase.
- Stamp and registration charge
Apart from the home loan EMIs, another necessary expense is the stamp duty and registration charges collected by the Government. Therefore, evaluate the rate and charges applicable in that region before purchasing the property. That is why this factor must form a crucial part of one’s checklist for buying a house.
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