Written by Sumit Jain
Being Chartered Accountant by profession, Sumit has vast experience in internal audit. He has passion for reading financial articles. In his leisure time, he loves to write about the financial market.
Festival season is deemed auspicious for buying property. A lot of people defer their purchase to buy their dream home on a propitious date as we link it with prosperity.
During festival season, you also have more bargaining power when purchasing a property because of developers offers heavier discounts and unique host of freebies such as car parking, club membership and home amenities & appliances etc.You might be able to negotiate discounts or added benefits on your purchase in such conditions. In addition, this festive season is also well supported by Low interest Rate, Government subsidy schemes, Stable Property rates and implementation of Real Estate Regulation and Development Act, 2016.
Low Interest rate:
Interest rates play a critical factor in how much Interest you will pay on your Home Loan. The lower the rate you can get, the less you l pay for your house over the course of your Home Loan tenure.
In the past 9- 12 months, Rate of Interest on home loan for small loans have gone down sharply and its impacted Lower EMI and increase loan amount eligibility also.
With Interest rates remaining low, its great time to take advantage of low interest rates.
Benefits of CLSS Subsidy
Central government eyes a pucca roof over every Indian by 2022 with its progressive Credit Linked Subsidy Scheme under PMAY -2022. Credit Linked subsidy scheme basically means that the government will cover the Interest cost upto 2,67 Lacs for you. So if you take Home loan of Rs. 6 lakhs and subsidy thereon works out to approximately Rs. 2.67 lakhs,
the amount Rs. 2.67 lakhs would be reduced upfront from the loan i.e. the loan would reduce to Rs. 3.33 lakhs and have to pay EMIs on the reduced amount of Rs. 3.33 lakhs.
Increase transparency through RERA implementation
Government of India has enacted the Real Estate Regulation and Development Act 2016 with effect from May 1, 2017. The key objectives of the Act was to Ensuring efficiency and transparency in the real estate sector , protecting consumer interest by promoting fair play in the sector and Encourages timely delivery of projects.
Now you will be able to make informed choices and are much more likely to invest without hesitation in the sector when you exactly know what you are paying for. You can study the project data on RERA sites.
Property rates are stable
Source: National Housing bank*
If we glance on the above Housing Price Index chart, we can note there is a slow movement in last 5 years. Prices are more or less at the same level they were few years ago. End user should take the advantage for stable property rates.
What would be better time than this festive season when you have low interest rate and plenty of affordable housing projects Going an extra mile, Central Government is providing interest subsidy upto Rs 2.67 lac on home loans to eligible borrowers. There a lot to learn, but here an assessment of where the market stands and factors you should consider. With above information, you can make a wise decision to buy your dream home.