Five Things to Remember Before You Buy Property

Mar 08, 2017

Remember those days when the toughest decision was selecting the right ice-cream flavour on a day out with your parents? If only life could always remain that simple! Growing up has its own perks and pains, but making the right decisions remains a major challenge. You would understand this even better if you were looking to buy property. There are so many choices and so many things to be cautious about that even the shrewdest investor could have a hard time.

To make matters a bit simpler, we have listed the top five things you must consider before buying property. Take a quick look.

1. Affordability

Before you buy property, make sure that you can afford it. Buying a house is not just a personal move. It may also affect your finances and your family's future wellbeing. So, before you venture out to buy property, closely analyze your financial health. How much can you spend on the property? How would you accommodate the EMIs along with your existing expenses? How would you repay the loan if you suddenly had other financial obligations? These are important questions that you must answer truthfully to know which home you can afford and at what point of time in your life.

2. Property location

Real estate is not a flexible investment. It takes a lot of time and effort to buy a property, and even more to sell it in the future. This means that once you finalise the location, you are likely to stay put in that area for years, if not decades. So think about the location of the property. Consider how it is likely to grow in the future. Look at the authorities in the area. Are they likely to develop it further or let it fall into ruins? Take the example of Navi Mumbai-it's turned into a beautifully planned area. Some other areas could face the problem of overpopulation. So all this becomes your biggest considerations.

3. Value of the property

A house may be your dream home, but it is also a big investment. So, make sure you buy a house that is valuable in every way. It must increase in value over the years. You should be able to make a hefty profit if you want to sell it in future. The location, the size, the builder's reputation, etc., are some factors that affect the value of a property.

Related: Mumbai, Delhi, Bangalore - How buying a house differs across cities

4. Financing options

Today, it is almost impossible to buy property without securing a proper funding option. So, you must first consider the various funding options you have. You can opt for a home loan from a bank or another financial organization. You can also explore other options, such as using an inheritance to buy property or selling an existing house to buy a new one.

Related: Choosing the right home loan is easier than it's ever been

It is not uncommon for people to make a part of the payment through cash. If you, too, had kept aside some money for this purpose, you may now find it difficult to use the cash because of the demonetization of currency notes. At such a time, you may have to make a complete reassessment of the funding options and select one that provides you the best deal.

5. Licences and approval copies

Last but not least, be careful about the property's legitimacy. There have been cases where builders have built properties on illegal plots, dishonoured licensing terms, and committed other types of fraud in their construction projects. If you are not careful, you may end up with an illegal property. So, make all the necessary checks before you finalize any deal.

The bottom line

Buying property can be rewarding. But go about the task in the right manner. Keep the above-mentioned guidelines in mind and your job will become much simpler.