POSTED BY July 31, 2009 COMMENTS (5)ON
Deepak Shenoy came up with a very nice article on How Builders are not keeping there promises while delivering the Residential Properties. He shares his views on Why it does not make sense to buy Real estate currently at idiotic prices level currently .
He also links to another article of this where he compares Renting Vs Buying a Flat. I am embedding the same video here which he has on this Excellent article. Have a look.
I am not a big Real Estate expert my self , but from Financial Planning point of view I have to say that Buying Home is an Important decision and we should look forward to it , but never at the cost of putting our self in a situation which can become disaster for our self. If you earn 50,000 per month, it does not mean you go next day and buy a Flat where you EMI is 40,000 .
Most of the people do not concentrate on Long term and have a short term view . Buying House needs planning and consideration of various factors . You need to find Value in the property which you are buying , just don’t see the value . A property worth 40 lacs may look Cheap , but its worth still be less than its price . Do you know the Formula to calculate the EMI on home loan ?
Given the uncertainty of Stock Markets in near term and no big improvement in Real – Estate sector , I am myself still not excited in Buying anything in real-estate (the main reason is that I don’t have much money).
“I wouldn’t put money into real estate unless it fulfilled three conditions—
- It is a property I would be happy to live in.
- I could put down at least 25 per cent of the total cost;
- The EMI is less than half of my monthly savings.
With those conditions, it would be unlikely that I would exit the investment; not finding a tenant wouldn’t upset me; and with the balance of my surplus income, I could continue to build a nest egg of other assets. Read full Article“
This view can look like a pessimistic views at first, but in the long run, these things pay off. Don’t take much risk that you are not alive next time to take another is the Funda you should Remember.
Please comment on what do you think about the Real – estate sector currently in your City. Also do share what is the most important thing one should look at before buying a Flat?