Own House -Cost you should afford? When to buy it?(Telugu)
Own House is one of our Main dreams. We do not know when our house owner will ask us to vacate the house. We feel peaceful and happy residing in our own house. But the real problem comes while buying a house, the cost of the house we can afford and when to buy it. These two questions are very difficult questions for many people.
Cautions before buying Own house…
Own House Cost you can afford?
I have seen so many young people when they start their career. Their First priority will be to buy a Bike or Scooter or a Mobile. Then they will get married. Majority of them will not save any money for the first home.
After Marriage, They will try hard to buy home with very little money in hands. They may be having 10% of funds or nothing in hand and for rest, they will go for a home loan.
The Main precaution to take here is, going for bigger Own House for which they can not afford is the biggest mistake that many youngsters will do.
Its Ok, Own house is an Important Financial Goal, But because of this goal, your other Financial Goals should not be compromised.
I will explain in detail…
We will be having some other Financial goals also apart from Own House like Retirement, 1st Child Higher Education, 2nd Child Higher Education, and Child Marriage etc.
Most people buy an Own House which they can not afford, Because of this, their other goals will be compromised. They will lose the opportunity to achieve other Financial Goals which mentioned above because of their Bigger Own House. They may realize or may not realize it inthe future. This is s problem in buying a Bigger Own House(Big Budget House).
How to know the cost that you can afford on Own House? Is it Possible to know today?
yes it is possible to know the cost that you can afford on your own house today. You know your income today. We can predict your future income growth year on year. We can get past inflation data.
You know your other Financial Goals also like child higher education, current household expenses. We can get past inflation figures from The Income Tax department. We know the present cost of Financial Goals.
After gathering the above information, With the help of “Time Value of Money” formula, we can calculate the cost that you can afford on your “Own House”. You can get some knowledge about the time value of money with help of my articles in this link. https://paisahealth.in/category/time-value-of-money/
If you are unable to decide the cost that you can afford on home, then A Professional Sebi Registered Investment Adviser can help you in this matter.
When to buy a Own House?
It is always better to buy when you have at least 30% to 40% of funds in our hands. For that, I suggest to gather funds for some years. Once 30% to 40% funds gathered, then go for a home loan and buy the home.
So, you should consider before a home 1. The cost that you can afford on home(without disturbing other Imp financial goals) 2. After gathering at least 30% of the funds required. 3. Make sure that you are paying only 30% of your take-home salary as “EMI”.
I made a video in my youtube channel about the same topic. Click on the video to watch it.
Read the article on Buying real estate with a loan. https://paisahealth.in/real-estate-investment-with-loan-why-you-will-get-losstelugu/
Also, the article about Real Estate-Why it is a Bad Investment? (Telugu). Click here to read.