Thursday, 16 June 2016

Things to keep in mind before you buy your first house

Owning a home is a dream most of us have, in fact it is statement to your success and announcement that you have arrived in life. Most people would love to buy a property but are held back due to continually rising prices and insecurities related to their jobs, and it is wise as buying a home is a huge long term commitment.

As more and more projects are being launched, that promise you everything from a car to the Moon, we list out a few things you need to keep in mind before you take the plunge.

The only direction real estate goes is up- everyone believes real estate prices never fluctuate, this is a myth, real estate as with other asset classes also goes through its ups and downs, however, the difference is that it is not as volatile as say, gold or stock market. While it might be tempting to buy a home right now when it seems prices are low, it makes sense to save more if you are at the beginning of your career, that way you can reduce the amount of loan you have to avail when you make the purchase.

This is the cheapest property in the area – you might be tempted by the fact that you are getting an apartment at 8-10% cheaper than the others in the area; however this isn’t the entire picture. What you need to check is the size of the apartment. Compare the price per square feet to get a fair idea of the price of the flat.

Rates will go up soon- Most agents advise you that the property you are looking at is almost sold out and will witness an upward price revision. However, the reality is that builders and developers are dependent on buyers for cash, so they would be offering you discounts and freebies, keep this in mind and make the purchase for maximum benefit.

Penalty for late Delivery- Agents would generally assure you that due to the penalty clause in the agreement your investment is safe, however it is advisable to check the contract and not bank upon the compensation entirely as the penalty is usually on the base price and would not be close to the EMI you are paying, additionally most contracts have a clause in the agreement which states that if the project is delayed because of 'factors outside their control', they will not be liable. So, make sure to get a legal expert to go through the agreement. 

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