Buying a home is the biggest purchase that an individual makes in his/her lifetime. If you’ve applied for a housing loan to go about it, chances are you’ll most likely be paying it off for years, possibly even decades. While all of this is true, there is still such a thing as spending excessively on a house. If you spend far too much on a house, you could be left with precious little for other goals and ambitions in your life, such as retirement, college funds, vacations, and more.
While the idea of a dream home may vary from person to person, money is still an object for most. The problem is that most homebuyers stretch their finances far too much when they’re ready to turn their home owning dreams into a reality. You’ll have to ask yourself whether you really need a huge master bedroom, the penthouse suite, or whatever it may be that your heart desires. Beware of denting your finances beyond repair in trying to purchase that perfect home.
First-time homebuyers tend to shop primarily with the amount that they’ve taken on as a loan, while failing to consider other expenses that are sure to rise up along the way. This puts them in danger of financial struggles and even potential foreclosures if they default on their monthly payments.
As a rule of thumb, your home loan EMI should not exceed 40% of your net household income, provided you have no other loans and debts. A high EMI can put excessive pressure on your household budget. In case your home loan EMI accounts for over 50% of your net household income, any other goals or aspirations you have will have to take a hit and be minimized or scrapped altogether.
Buyers need to ensure that they do not take a loan that stretches their finances at the seams. It’s easy to get lost and cloud your judgment while expecting generous increments in the future. However, that is precisely what buyers need to be most wary of - making huge purchasing decisions based on projected or assumed future income.
As with most other big purchases, there will be several other additional expenses that need to be covered. The price you see in advertisements is generally the base price of the property. Add-ons are usually saved for when a customer pulls out the cheque book. Builders typically find a way to sneak in charges for facilities that you’d assumed came free with the property. Make sure you make your purchase from a trusted, reputable builder like Bricks & Milestones.
In case you’ve got the financial aspect of buying a home covered, good timing is crucial. While owning a home is seen as a huge milestone in terms of financial stability and independence, buying a home at the wrong point in your life can tie you down to a place that you may potentially not want to be in. Buying a home too early can hamper your growth prospects, professionally and otherwise. Make sure you get the timing right, and you could actualize your dreams sooner than you might think! At Wonderwall, we have an array of 1, 2 & 3 BHK homes for you to choose from, as per your requirements and budget. Located in the rapidly developing Sarjapur region of Bangalore, experience the benefits of connectivity while still coming home to your very own niche at the end of a long day.