An Ultimate 7-Steps Guide To Buy A House In India

By lodha

Buying a home is often considered a major milestone in one's life. It is a profound and transformative experience. In a country like India marked by diverse landscapes, vibrant cultures, and a dynamic real estate market, the process of acquiring a home demands careful consideration and strategic planning. Whether you're a first-time homebuyer or a seasoned investor, the quest for the perfect abode involves navigating through a myriad of choices, legalities, and financial considerations.

It's also a huge financial decision and therefore can seem daunting to many. However, with careful planning and keeping certain things in mind, one can easily accomplish this goal. In this article, we have looked at the key things to consider when buying a home in India as well as how to plan buying a house.

1. Begin with Budgeting

The first and most important step in the home-buying process is budgeting. Before deciding how to plan to buy a house, do a thorough assessment of your finances and figure out how much money you can spend on buying a house, renovating or decorating it, and maintaining it over the years. Pay attention to all your financial commitments and make sure you are going within your means when buying a home. It is always advisable to have ample savings before taking the plunge on buying a home. You can use an EMI calculator tool to ascertain that you remain within your budget as this tool will give you a fair idea of what the outgoing amount will be every month. To this, you can then add your monthly expenditure and factor in the emergency fund to arrive at a home loan amount that you will be comfortable with.

2. Choose the Location with Care

It's not just about the quality of your home, but also its location. Before finalising an area or locality you want to live in, consider the amenities you and your family need. For instance, if you have growing children in your family, it is advisable to live in areas that house the top schools in the city. Or, if you are a working professional, then consider areas that have good connectivity to key business hubs and the rest of the city. It is also important to consider the purpose of your home before choosing a locality. If you are looking to invest in real estate, choose a locality that will stay in demand and improve the resale value of your home.

3. Study the Housing Market

Before diving in and buying a home, it is a good idea to take stock of the present housing market. This means that you should consider the real estate forecasts for the city and locality you want to live in, which can help you make an informed decision about your home. Keeping up with real estate forecasts will help you identify cities and areas that are in or will be in demand due to low rent rates or upcoming infrastructure projects. You can also consider consulting with developers and real estate industry experts before deciding on a home to buy.

4. Check Your CIBIL Score for Home Loan Eligibility

If you intend to take out a home loan to purchase a home in India, you should first ensure that you are in good financial standing. Your home loan eligibility as well as your ability to get a reasonable interest rate depends largely on your CIBIL score. This 3-digit score is a numeric summary of your credit based on your borrowing and repayment history. If you pay your credit card bills, repay loans on time, and don't default on debts, you are likely to have a higher CIBIL score. You can improve your CIBIL score by taking charge of your finances, ensuring timely payments, and using your credit wisely.

5. Save For EMIs and Down Payments

It's a good idea to start saving up for the down payment of your home much before you secure a home loan for said home. The Reserve Bank of India (RBI) mandates that lenders can only provide 80% of the property value as a home loan, which means that homebuyers still need to pay 20% of the cost of the home as a down payment themselves. Additionally, do factor in the costs such as additional charges levied by the developer, plus costs towards interiors. By planning for this down payment and saving up early on, you can keep any financial stress at bay and make the home-buying process much smoother. If you need to figure out how much EMI you will have to pay on your home loan, make your life easier by using Lodha's seamless Home Loan EMI calculator. With only a few simple bits of information, you can use the calculator to financially plan for your new home.

6. Take Your Time to Find the Right Home

With so many home options out there in the market, it can be hard to narrow down the right one for you. On the other hand, many people get stuck living in poor-quality homes or working with sub-par developers because they chose the first house that they saw without considering other options. Some people are also unwilling to make compromises, which in turn compromises their ability to find a good home. This is why it is a good idea to take your time to research the Grade A developers to ensure that the home you are buying is built to a high standard and quality. It also helps to have a checklist of the non-negotiable things that you need for your home, such as outdoor space for your little ones to play or a deck. Also, factor in your future needs as a family and the lifestyle you envision having. Choosing a home is also about being with a like-minded community that will enable you to grow in life.

7. Choose a Grade A Developer

With Grade A developers, you can rest assured that the home you are buying is legally compliant and is built with the highest quality standards. Owing to their scale and experience, Grade A developers also have in-house expertise and collaborate with the best names in the industry to develop world-class projects that provide the finest lifestyle. Apart from the latest amenities, they also ensure the highest standard of quality construction using the latest technology and ensure the project is sustainably built. Moreover, they also provide a seamless customer experience through the home buying journey - with robust customer service, information at your fingertips, support with loans & registrations, and engagement beyond possession that ensures you have a great experience.

Get Homeowners Insurance, a Home Inspection, and a Home Appraisal

After you have selected your home and completed the paperwork, it’s crucial to take out homeowners insurance to protect your investment from any unforeseen events such as fire, theft, or natural disasters. Additionally, conduct a thorough home inspection and appraisal to ensure the property's value aligns with your purchase price and that no hidden issues exist. A home appraisal provides a detailed estimate of the property's value, while an inspection checks the structural integrity and safety.

Ongoing Expenses of Homeownership

Owning a home comes with several ongoing expenses that must be considered in your budget:

• Mortgage Payments: This is the primary ongoing expense, paid monthly to your lender.
• Homeowner's Insurance: This ensures your property is protected against unforeseen events like fire, natural disasters, etc.
• Property Taxes: Annual taxes levied by the local government based on the value of your home.
• Homeowners Association (HOA) Fees: If applicable, you’ll pay monthly or annual fees to the HOA for maintaining shared amenities and services in your community.
• Emergency Fund: It’s wise to maintain an emergency fund for unexpected repairs or replacements, as homes often require upkeep.

Why Is Now a Good Time to Invest in a New Home?

According to IMARC Group, the Indian real estate market is expected to exhibit a growth rate (CAGR) of 9.2% during 2023-2028. It's no secret that the real estate industry has changed dramatically over the last decade. Eco-friendly architecture, landscape planning, gated communities, upgraded facilities, lower mortgage rates, tax benefits, increased transparency, and government aid for low-income people are some of the developments in the real estate market that will continue to pent-up demand for properties. As a result, the real estate industry is expected to grow rapidly in 2023.

Factors to Gauge the Right Moment for Home Buying

Several factors can contribute to making it the right time to buy a home. While individual circumstances vary, here are key considerations that may indicate favorable conditions for homebuying:

• Low Interest Rates: When interest rates are low, borrowing costs are reduced, making homeownership more affordable.
• Stable or Growing Real Estate Market: In a stable or growing real estate market, property buying values are less likely to experience sharp declines.
• Favorable Economic Conditions: Positive economic conditions, including low unemployment rates and steady job growth, contribute to consumer confidence.
• Availability of Government Incentives: Government incentives, such as tax credits, subsidies, or first-time homebuyer programs, can make homeownership more financially attractive.
• Personal Financial Stability: A secure financial position, including a stable job, emergency savings, and manageable debt, indicates that you may be well-positioned for homeownership.
• Long-Term Stay in the Area: If you plan to stay in a particular area for an extended period, buying a home can offer stability and potential long-term value appreciation.
• Increased Negotiation Power: In a buyer's market, buyers often have increased negotiation power, leading to more favorable terms.
• Potential Tax Benefits: Homeownership can bring potential tax benefits, such as deductions on mortgage interest payments and property taxes.
• Life Milestones and Family Planning: Major life milestones, such as starting a family or reaching a certain career stage, may signal that you are ready for the stability and space that homeownership provides.

Frequently Asked Questions

1. What should I know before buying a house?
   Before buying a home, it's important to know your budget, evaluate the location, understand financing options, check your credit score, and conduct a thorough inspection of the property.
2. Is this the best time for buying a house?
   The best time you’d know how to buy a house depends on market conditions, interest rates, your personal financial stability, and future plans. If interest rates are low and the market is stable, it might be a good time to invest in a property.

Lodha: Your Partner in Luxury Living

When choosing between flats and apartments, it’s crucial to invest in a property that aligns with your lifestyle, preferences, and long-term goals. At Lodha, we understand the value of quality living and offer a range of luxury homes designed to elevate your lifestyle. Explore our exceptional residential developments today and experience the perfect balance of comfort, convenience, and style.