Reena and Rahul had been scouting for a new home on rent for a few weeks now. This is the 5th time in 4 years they would be changing their home. 3 out of 5 times they changed their home as their landlord wanted to sell it off to another buyer. Seeing the trend of people buying their own homes, the Jaipur based couple started evaluating whether they too should now think of purchasing their own house near Jaipur.
Numbers Don’t Lie.
Case 1 – Let’s assume that you rent a 3-BHK home for rent of 20,000 rupees per month. This is way below the actual rental values in cities and other residential suburbs. And, let’s assume the average house rental value increases at 5% per annum. Again, this is way lower than norms.
Case 2 – Let’s assume that you buy a ready-to-move 3-BHK home for a cost of 40 lakhs. You take a home loan for twenty years.
Here’s a look at the figures in both cases.
|Case 1 – Rental Home|
|Rent per month||20,000 INR|
|Rent appreciation PA||5%|
|Total Rent Amount paid after 20 years||80 Lacs|
|Asset Value after 20 years||0|
|Case 2 – Own Home|
|Loan amount (Women)||40 lakhs|
|Tenure of the loan||20 years|
|Interest rate (Women)||7.2%|
|EMI during the tenure||31,494 INR|
|Total amount paid after 20 years||75,58,552 Lacs|
|Asset Value after 20 Years at 10% appreciation Per Annum||2.69 Crores|
As you can see, in this example, when you take a house on rent, you end up paying almost the same cost as owning a house . However, when you buy a home, you are building an asset that increases your wealth.
When you live in a rented property, you have to follow the rules and regulations set by the landlord.
Here are some of the common rules set up by landlords in India – no tacking nails to the walls, no drilling holes, no entertaining guests late at night, no house parties, no cooking/eating non-veg at home – the list of no’s, keep on going.
It Makes Better Sense
Reena and Rahul thought about what Raman shared and then did their own calculations. They realised that apart from the above three reasons, purchasing a home offers other myriad benefits like – tax savings, sense of emotional and social security, hassle-free living, no need to frequently shift their residence again and again, and more.
Reena concluded, “Clearly, this is why buying a home is considered as laying down one’s roots.”
Invest in a home today and provide your family with a secured life.”
Ashiana, Ashiana Housing build homes. Homes surrounded by vast green spaces and fresh breeze. Homes cocooned in secured gated complexes. Homes where futures are forged and there are opportunities to grow. And Homes in environments brimming with healthy activity, trust and respect. At heart, we build communities with care.
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