The best part about being in metro cities is that there are ample opportunities to earn well and build a long, well-paying and fruitful career here. Also, the quality of life is much better when you look at amenities and entertainment options that these cities offer.
But there is another factor that makes these cities look quite formidable – the high property prices. That is a reality and there is not denying that. Apartments that could be bought for around Rs 35 lacs in non-metro cities can easily cost upwards of Rs 1 crore in metros like Delhi, Mumbai, Bengaluru, etc.
Fortunately, there is help at hand in form of home loans. Had it not been for these home loans, it would have become very difficult to purchase homes in these big cities.
Now there is a very important factor that many people miss out on. In a hurry to own a house of their own in big metro cities, many people fail to prepare themselves for these loans. To buy homes in cities, you need to be ready to bear higher costs. And if you want to finance these homes, it means you need to be ready to pay higher EMIs.
But whether or not one is ready to pay high EMIs is something important and worth considering.
Lenders don’t approve a home loan (of the applied loan amount) if borrower’s total EMI goes beyond 40% of their take-home salaries. So for example, your take-home pay is Rs 1 lac, then your EMI should not exceed Rs 40,000. Now an EMI of Rs 40,000 means that the home loan you can get would be about Rs 46 lacs. Since this is to be equal to 80% of the cost of property and rest 20% is to be made as down payment, you can at best buy a property that costs Rs 57 lacs or lesser. So if you are planning to buy a house, be rational about your ability to pay the EMIs today as well as in future. And if you are in metros, you need to be more careful about your repayment ability given the high EMIs.