A Handy Guide on Budgeting and Saving Up for a Home in Today’s Economy

By Lodha

Ask anyone, and buying a house is at the top of their bucket list. However, with news about property prices and interest rates, the thought of buying property in today’s economy can be intimidating. Thankfully, your dream home is not a fantasy but a reality within your reach. With the right tactics, you can budget your income and spending and save up to buy a home in the near future. If you are ready to move into your own home, here is a guide to help you manage your finances and save up to buy property in India!

Evaluate Your Financial Health:

Before entering a real estate transaction, it is best to assess your financial standing. Take the time to calculate your income, including other revenue streams like gigs, investments, pay outs, etc. Next, identify your monthly expenses, including fixed costs like rent and insurance premiums as well as groceries, utilities, and other bills. Find areas where you spend frivolously and can cut down on expenses.

Set a Down Payment Goal:

Once you have an idea of what your finances look like, you can estimate how much money you would be able to put forth as a down payment. Ideally, it is best to be able to pay at least 20% of a property’s price as a down payment. However, if you can manage paying a larger sum upfront, you can save on monthly instalments and interest. Knowing the kind of down-payment you can afford also helps you select a home within your budget.

Consider Hidden Costs and Fees:

While budgeting for a home, do not make the mistake of disregarding additional costs. When you invest in property, you also have to pay stamp duty and registration fees at rates determined by the State Government. Additionally, you may have to pay brokerage, maintenance charges, fees for a parking space and more. Remember to consider these costs while saving up for a home to avoid surprise expenses down the line.

Plan Monthly Expenses:

Buying a home requires you to have long-term plans and factor in monthly expenses after you have moved into your home. If you have bought the home using a housing loan, you will have to pay EMI every month. Additionally, as a homeowner, you may also have to shell out money for taxes and insurance on the property. Ideally, it is best if you plan for such monthly expenses in advance to prevent any delays, defaults, or disruptions.

Create a Nest Egg:

Life is unpredictable, and moving into a house is not a fool proof solution to any curveballs it throws at you. To ensure you are prepared for when life catches you by surprise, save up and create a nest egg to cover emergencies. You can set aside a sum every month and steadily build a corpus you can dip into if ever required.

Review Your Credit Score:

If you are planning to apply for a home loan to help finance your real estate investment, it is important to keep an eye on your credit score. A good credit score can make it easier to get loan approvals. If your credit score is on the lower end, you can remedy it by reducing your debt, paying credit card bills and EMIs on time, and staying within your credit limit.

Timing the Market:

The last tip to buy your dream home within your budget is to keep a keen eye on the real estate market. Often, economic and geo-political reasons can create a market where property rates are low. You can tap into such a market and buy a home within your budget. It is also best to be aware of housing subsidies, grants, and tax breaks offered by the government and deals offered by property builders and leverage them to reduce your financial burden.

Now that you know the tips and tricks needed to budget and save up for a home, make sure to streamline your finances and make a wise real estate decision. If you want to move into a home that offers impeccable modern construction quality and interiors done by the top designers in India, look no further than Lodha. Lodha, one of the top real estate and construction companies in India, is known for providing housing that ranges from the luxurious to the comfortable. With residential developments across major cities in India, Lodha is where you will find your dream house and build a beautiful life.