It’s that age-old question again: is it wise to buy a house or should you continue renting? The answer isn’t that straightforward. Arguments can be made for both cases with each side having pros and cons. While buying a home offers you greater stability, renting can be the cheaper option in the short run. So how do you come to a decision? Whether you should buy or rent is largely dependent upon several factors that are specific to you. Here are seven questions that will help you determine whether buying a house is the right decision for you.
How good are your finances?
The most important factor to take into consideration is your savings. While the idea that real estate is too expensive for the common man is one of the common real estate myths, not everyone has the entire property value saved. Most home-buyers take out home loans to help them realize their dream of becoming a homeowner. Home loan regulations might have eased up, but you can’t depend on them completely to pay for your dream home. Most banks will only give you 80-90% of the funds you require. You will need to pay the remaining money yourself in the form of a down payment.
Before you decide you want to invest in a house, check to see if you’re eligible for a home loan. Banks look at a number of factors before they approve your home loan application. If you have existing loans, unpaid debts or a low credit score, you might not be able to secure a loan. If this is the case, spend a few years improving your personal profile before deciding to apply for a loan. This is one of the top tips to apply for a home loan. But if your finances are in order, then it makes complete sense to buy a home instead of renting one.
If you’re financially secure, then there’s no reason why you shouldn’t consider buying a home. However, if you don’t feel you’re quite there yet, it’s completely fine to wait a few years first.
How stable is your lifestyle?
If you’re going to stay in the same place for many years, then it is a good idea to invest in a home. However, if you are buying a home with the help of a home loan, you will end up paying EMIs every month for a few years. This means that your investment will only become profitable after your EMI installments are over. On the other hand, if you keep switching jobs and moving to different places, then you should probably put off your decision to buy a home.
Do you want the freedom to personalize your home?
One of the biggest grievances renters have is that they cannot make any changes to their house. If they so much as repaint the walls, they could end up losing a chunk of their security deposit. When you buy a house, you have complete freedom to decorate it as per your preferences. You can hang paintings where you like, build shelves and change wall colours to suit your taste. This freedom from overbearing landlords is a heady feeling that definitely makes investing in a home worth it.
What are the real estate trends in your city?
Are real estate prices on the rise in your area? For your investment to be profitable, you need the price of your home to appreciate with time. Look at real estate trends in your city and see if there’s a pattern. If property prices have been increasing, then buying a home now could give you high returns in the future. Chennai, for example, is a growing real estate hub, with property values going up. However, if prices have remained stagnant or are falling in your city, then buying a house might be a losing bet. If you want to buy a home, look for properties in areas of your city that are quickly becoming popular or wait it out for a bit until real estate picks up.
Does it make sense in terms of investment?
If you’re looking to buy a house as an investment for now, then there are two things you need to look at: how easily you will find tenants and how quickly real estate prices are rising. Many people choose to buy a home and rent it out as a means of earning a second income. If you’re planning on doing this, you will need to invest in a property near colleges or offices, so you’ll find tenants easily.
What is your future earning potential?
The amount of your future income has a big role to play in deciding if you should invest in a home. After you buy a house, you will be paying off your home loan for many years to come. If you have a stable job and your salary is going to keep increasing, buying a house is a safe decision. However, if your job isn’t secure right now, wait until things settle down a bit before making a commitment to buying a home.
If you have decided to buy a house, then find your dream home with Lancor. Our beautiful luxury apartments situated in some of the best localities in Chennai, give you enough reason to never delay a property investment.