- The growth of income in India in last three years has beaten the housing prices.
- The income slab extension to cover subsidy for first-time home buyers is another reason to buy a home now.
In almost a decade, this is the right time to buy a house because of affordability. A number of factors have played a part to make this fiscal year most favourable since 2005 to purchase a home in India.
As per a report by international brokerage firm CLSA, the growth of income in India in last three years has beaten the housing prices making it more profitable for buyers to buy a home in this fiscal year. Also, 100 basis points in mortgage-rate cut mean 5 percent to 6 percent price cuts and in past two years mortgage rates have dropped by 150 basis points which are the lowest in 12 years, the same report stated.
In terms of prices, data analytics firm PropEquity observed that housing rates have fallen by 1.67 percent in the fourth quarter (January to March 2017) from the rates in December last year in eight major cities in India including Bengaluru, Chennai, Mumbai and Pune.
Also, the government’s focus on affordable housing in this year’s Union Budget would further help the builders to get a loan for cheaper interest rates who are expected to transfer the loan benefits to the buyers with lower selling prices.
The income slab extension to cover subsidy for first-time home buyers is another reason to buy a home now. Earlier, subsidy on home loan interest was given to those earning an income up to ₹6 lakh per year but now the subsidy is also available to those having an income of ₹12 lakh and ₹18 lakh per annum.
Subsidy on the home loan interest rate for those with income up to ₹12 lakh will be 4 percentage points on the principal amount of ₹9 lakh and for those earning up to ₹18 lakh per annum will be 3 percentage points on the principal component of ₹12 lakh. Also, the new income slabs are applicable on loans having a tenure of up to 20 years as opposed to 15 years now.
In other words, this is the time to get value for money and buy the home of your dream.
Last Updated 31, Mar 2018, 7:07 PM IST