After the starting of Navaratra, the festive season started in India, and with it the season of property -buying, will begin in earnest.
It is the time of the year when the majority of property purchases take place in our country. Think deeply about the factors that you should take into consideration before making the buy decision, and do some preliminary research in order to avoid harassment at a later stage.
Location: Both the spouses should take into consideration the distance from their workplaces and from their children’s schools. If the travel time for any member of the family is beyond 45 minutes, it is likely to affect quality of life adversely.
Generally, at the time of house purchase, there is a tendency to make an optimistic assessment of travel time. Do take into account things like walking distance from your house to the bus stop or the Metro station, time required in changing modes of transportation, and so on.
If you have your private conveyance, remember that traffic will only increase with the passage of years, and so will your travel time.
There may be plans for a Metro line or an expressway in the forthcoming destinations and information about such plans is available in the public domain several years before a project actually comes up.
By consulting the area’s master plan and purchasing a house close to the planned project, you can reduce your daily walking distance and enhance the prospect of appreciation of your property’s value in future.
Take the instance of Noida Extension. It is well known that the Metro line that to Noida, Sector 32, will in future be extended to the main roundabout in Noida Extension (where a Metro station will also come up). Do try to buy an apartment that is within walking distance of a Metro station.
Once you start living in an area, its social infrastructure will have a profound impact on the quality of life you enjoy. Find out how far away the nearest market place, where you will buy your daily necessities, and bigger markets, where big-ticket items can be purchased, are situated.
Also find out about the availability of hospitals and movie theatres in the neighborhood.
In new areas, if the social infrastructure is not already in place, then for the first few years you may have to depend on neighborhood areas. For instance, residents who move into the Dwarka Expressway area may, in the initial years, have to depend on the social infrastructure of Palam Vihar, Gurgaon and Dwarka.
Those who buy apartments in Noida Extension may have to depend on Noida for their recreational and big-ticket shopping. Will the distance be too great and thereby cause inconvenience?
The availability of water and electricity should also be taken into account. Increasingly, many parts of South Delhi and Gurgaon are becoming water deficient.
Such shortages cause harassment in daily life. Even if a system for supply of water via private tankers is available, it will add to your monthly bill. Even if the cost of water per se does not rise much in future, the cost of fuel is likely to gallop. Hence, be prepared for rising water bills.
The same holds true for power scarcity. In several parts of the National Capital Region (NCR), electricity cuts become routine and last for as long as eight to 12 hours in summer months.
Builders will tell you glibly that their projects offer power backup. But the power backup comes at an extra cost: a unit supplied from a generator always costs more than a unit supplied by the power-utility company.
Pricing and affordability will have a bearing on both the locality that you can buy in and the builder you can buy from (projects of reputed builders with a sound track record typically cost more than those of smaller builders).
Again, the tendency to overestimate how much equated monthly installment (EMI) you can afford each month should be curbed. Veer Sardesai, a Pune-based financial planner, says: “For six months prior to buying a house, start putting aside money each month to see how much EMI you can realistically afford.”
With more people now finding jobs in the private sector, the cradle-to-grave certainty of government jobs has now become a thing of the past. Factor in the possibility of a job loss or a period of unemployment during the 10-15 years for which the EMI on your home loan will have to be paid.
To reduce risk, consider developing a back-up corpus. Double income and a second source of income (moonlighting or a side business) are other ways through which you can reduce the financial risk that arises from the purchase of a house.
Another important aspect of pricing is to understand in explicit terms exactly what is being offered for the price charged.