Home loan interest rates at lowest in many years; take advantage to buy a house now Impact of the home loan rate While buying a home with a loan, buyers have two options: fixed rate or a floating rate. Since interest rates are expected to fall further, most people would opt for a floating rate. Even a small cut in the interest rate could make a huge difference in the total payment outgo in long tenure of, say, 20, 25, or 30 years. Since the interest rate has already fallen to a single digit, home buyers can use this opportunity to make their bookings. Home loan is a long-term debt; therefore the ups and downs of the interest rate get averaged in the long run. Therefore, if you are getting a good deal, you should make the most of it. Unsold inventory Unsold inventory shows that the gap between the buyerâ€™s expected price and the price at which the developer is ready to sell, has widened. It means there is scope for a discount in the property price. This is a buyerâ€™s market and the end users are the price decider. On the flipside, an unduly long inventory overhang may result in poor financial health for the developer, and therefore you may be at a huge risk especially while buying an under-construction property. Low demand buyerâ€™s advantage Low property demand brings in a liquidity crunch for developers and therefore the project deadlines may not be met on time. Project delays bring in legal disputes and increase the cost of property due to additional interest burden. Developers come up with attractive discounts and offers to sell their inventories during such periods. Buyers should use this opportunity, provided they have a good read on the market, the project status, and the credibility of the developer. Buyers beware For an end user, whether the market is up or down, whether or not there are discounts involved and cost of borrowing is low or high is not that important through Emi Calculation for Home Loan. His top-most priority should be timely possession and undisputed ownership. When you buy a home, analyze local factors such as social and physical infrastructure, amenities, civic facilities, and demand in the area instead of keeping a larger purview. In a slowdown situation, the chance of a developer delaying delivery is high; therefore, home buyers can lower their risks by narrowing down on ready-to-move homes. With extra precaution, due diligence, and proper advice from an expert, home buyers can lock an attractive deal in the prevailing market situation.
Published on Oct 19, 2016
Use the interactive home loan calculator to calculate your home loan EMI. Get all details on interest payable and tenure using the housing l...