The decision whether to buy or rent property in today’s scenario becomes extremely difficult. This is so due to the current volatile economic scenario coupled with higher real estate prices. Other factors include zero or negative growth in incomes and inflated interest rates.
In this article we present to you some facts on How to decide whether to buy or rent property in 2014?
First, let’s consider certain questions you should consider before deciding anything in terms of your property. The questions are as follows-
- Is it a financially secured decision to buy a house?
- What benefit do I get when I rent a place?
- What are the lifestyle changes I will need to cope up with when I rent or buy a property? How will they affect my life and my dependents’ lives?
Further you can browse through some more important facts one should consider to land up at an accurate decision-
Regarding buying a property
- The down-payment amount for home loan (20 % of cost)
- Time required to collect the down payment amount (Number of years)
- Month wise property maintenance expenses
- EMI on home loan
- Annual property tax
- Annual repairs
- Income tax savings as per sections 80C & 24B.
- Current property price in the market
- Your gross income
Regarding renting a house
- Deposit amount of security
- Monthly rentals
- Annual increase in rent
- Month wise property maintenance charges
- Income tax savings as per HRA exemptions
- Your gross income
The EMI or the Monthly rent should not consume most part of your income. This can greatly affect a person’s current lifestyle & future goals. Also, it may not prove to be a financially good decision hampering your financial growth. Therefore, all the factors including the EMI and rental value must be carefully considered before arriving at any decision. Further you will gain knowledge regarding the favorable places in India to buy or rent a property.
Renting or buying in top Indian cities
Ahmadabad & Hyderabad are the most preferred markets to buy affordable properties as per ArthaYantra. On the other side, Delhi & Mumbai seems to be a battleground in terms of buying or renting a house. For a common man it’s just like a dream due to the much higher prices of properties in cities like Delhi & Mumbai.
Also the area of property available for the exact amount some years before has decreased. Therefore, more people prefer to rent a property than buying a property.
Hyderabad is an economically preferred destination when it comes to renting & buying a property. However, in Bengaluru, Pune, Kolkata and Ahmadabad the minimum salary level to buy a property is considered to be more than Rs. 11 Lakhs per year. These cities can be a good option for professionals working in Delhi or Mumbai.