#firsttimehomebuying

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Indian real estate sector is shaping itself dynamically with a progressive approach to migration. Presently, the Indian real estate sector is one of the most recognized sectors which influence rapid development and growth. According to the India Brand Equity Foundation (IBEF), the Indian real estate sector is expected to reach a market size of US $1 trillion by 2030 from the US $120 billion in 2017 and it will contribute 13% of the country’s GDP by 2025.

With this increasing rapid rate of development, the demand for residential housing is also increasing rapidly. Some of the reasons to consider for this rapid growth is increasing income, urbanization and economic growth moreover residential housing has become an essential asset for migrating population. Growing population in India has an impactful contribution in increasing the growth and rate of residential real estates. Education is also an important factor which has enabled the rural population to draft its shift to urban locations and thus, has made an increasing contribution to the urban housing system. Shifting of youth for employment to the cities has resulted in a key situation that has made housing more important. The increasing rate of development and education has made the need for rapid residential real estate sector growth a necessity. There has been a rapid increase of housing requirements also, due to the current practice and trend in Indian rural sector to migrate from rural areas to urban areas for a better livelihood.

Moreover, citizens in growing economies like India face difficult situations like a prospective home buyer facing a cash crunch to buy their dream home or having a limited choice of homes to select from. To bridge such situations HomeCapital has taken an initiative to assist the first time home buyers in India. It has come up with the first Down Payment Assistance Program with an objective to solve the biggest hurdle towards homeownership i.e. down payment. This program offers up to half of the home down payment requirement with zero cost EMI loans. Apart from this assistance provided by HomeCapital, the government of India has also taken steps forward by the scheme PMAY - Pradhan Mantri Awas Yojana which facilitates a vision to provide housing for all. The honorable prime minister of India has made an envision to provide housing for all Indians by 2022 when India will complete its 75th year of Independence. Such initiatives have made an important impact on making the residential real estate sector more convenient for home buyers. 

In today’s time, buying a home has become a mandatory part of our lives. It not only provides a roof over your head but also gives an option for future investments. For young adults who are in the starting phase of their career, it is important to start preparing yourself financially for the future. There will be one point in your life if not now when you will find a need to buy your own house. So when that time comes, ensure that you must be financially ready to tackle all the needs and requirements.

Planning your personal finance isn’t something that is taught at school or college but it is something that you must learn yourself. The lack of knowledge can leave the youngsters unaware of how to self manage their cash flow and fall under debts. To help understand the principles of savings, let’s start with the following:

Self Control: There are many products and technologies being introduced to the market every day. It is easy for someone to get distracted from savings and spend money on things that become just liabilities. It is possible to buy an item on EMIs if you wish, however, it is better to wait till you save the money for it. Try to limit your expenses on such things that are bound to be replaced by an item better than the current one.

Think about the future: The point mentioned above resonates with this one. You must think about your future and the goals that you want to accomplish while you advance in your career. You may come across many situations that will force you to spend tons of money like going out with friends, partying, shopping but keeping control is essential. It doesn’t mean that you are not allowed to enjoy your life but you must understand what is necessary and what could become a liability. Take charge, gain knowledge, understand how to make your money work for you.

Check on your cash outflow: Sometimes there are things that siphon away your funds although you think you are saving. One way to keep a check on your expenses is to plan a budget. You should plan a budget for whatever duration you want to maybe 30, 60 or even 90 days, however, the best option is to start small. Once you realize what expenses are necessary and which ones are blowing a hole in your pocket, making small adjustments in your expenses can have a big raise in your financial condition.

Plan for contingencies: Life is unpredictable. You never know what kind of crisis you may find yourself into. So in order to ensure that you don’t blow away all your money, it is advisable to build up a contingency fund. Having such savings can help you get out of any financial trouble at the time of an emergency. And if you maintain these savings without any reasoning then you will not only save for emergency but also for your retirement or vacation or even for the down payment of your home.

Take care of your health: This one here is non-negotiable. Planning a budget for medical expenses is a must. You can consult from different insurance providers for medical insurance at the lowest rates. It may help you later down the line in case you need to visit the emergency room where treatment can cost more money than you can imagine. Maintain good health by taking important steps daily like proper diet, exercise, not smoking, not consuming alcohol in excess and even driving carefully. This will ensure that you are off paying unduly high medical bills.

It is always said that Mumbai is the city of dreams where masses of people come for finding a source of income, settle, and fulfill their dreams. The city in itself home to millions of people who travel between the main city and its suburban areas for work. So thinking of buying a home in the city to reduce the commuting time is normal. It's the most common dream that is seen and felt by thousands of people residing in Mumbai.

So now that we are talking about buying a home in the city of dreams, let’s scope out the possibilities and options about buying a house. The first thing to do is to find a location that is feasible to commute to and from the workplace. Finding a location near to the workplace can prove to be a boon for long-distance commuters. Hence choosing a location wisely is very important.

Mumbai is very well connected with its suburbs with a vast network of roads and railways. So finding a location with a closer reach to transportation service could prove to be a blessing. If you have just started your career then it might be difficult to buy a house near your workplace and that’s where comes the commuting. Although it is impossible to eliminate it completely, it is possible to reduce the time it takes to commute.

Now that the location is decided the next step is to know your budget. The price per sq.ft area changes according to the different suburbs you are in. So determining the budget as per your location of choice is crucial. Having said that your location of choice should have all the basic necessities in close proximity for it will save a lot of traveling for any given reason.

So now another question stands, which is- Should you rent or buy a house in Mumbai? Well, it depends on many factors. First of all, you must decide on how long you want to stay at a particular location. The simple answer is that if any circumstances in your life demand you to move after some time, then renting a home is a viable option to choose or you can wait on buying a home and save up more.

Affordability is a major factor when buying a home in Mumbai. You must ensure that you can afford a home before you decide to buy one. You should do a financial assessment where you should consider your monthly income and all the expenses before you decide to take a home loan, the down payment and the EMIs. To be on a safer side make sure that your monthly instalments shouldn’t go above 25 per cent of your income. You must be practical about what you can afford and should not stretch beyond your limits even though you think you can manage later on. In case you cannot afford to buy a home now then think of renting a little longer or wait for something more affordable.