7 Tips To Keep In Mind While Buying Property Post Pandemic

MCOVID-19 seems to have given people a lot of time to rethink their investment decisions and for many buying a home has been a big one. According to ¡®India Real Estate Report 2020¡¯, there has been a significant shift towards homeownership in India in the wake of the pandemic. The report revealed that 89% of people consider the present to be the best time for buying a house. A majority (82%) also affirmed their plan to buy a property in 2021, registering a substantial increase in the purchase sentiment compared to the previous year (64%).

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Uncertain job market in the post-COVID-19 world and liquidity crunch has made things all the more completed when it comes to thinking about investment. But COVID-19 pandemic seems to have put multiple things into perspective for many. Among other learnings of these unprecedented times, owning a home rather than staying in a rented space has gained sudden importance.

Recent government and industry developments ¨C such as stamp duty rate cuts, attractive builder discounts, and lower interest rates on home loans by top banks ¨C have made buying more conducive.

Anarock Property Consultants conducted a survey during the lockdown, which points to the pandemic being more of an opportunity in residential real estate sector. According to the report, 48 per cent of the total participants in an ANAROCK survey, conducted to gauge housing market sentiment in COVID-19 times, chose real estate as their preferred investment asset class.

The survey also indicates that homeownership is now a compelling priority for millennials facing uncertain times. Out of the total voters favouring real estate, 55% are aged between 25-35 years ¨C and 68% are end-users. In the H2 2019 edition of this survey, only 42% were in this age bracket.

One of the most popular reasons for the switch in homeownership is the realization among tenants who were forcefully evicted out of their rented spaces, during the initial months of the pandemic. Owning a home in these unreal times has gained importance like never before. So, if you are considering a home purchase, here are some things you may want to take into consideration:

1. Take your home hunt online

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Amidst the pandemic, most prospective buyers had already switched to online portals for home searches. From price range and pictures of the property, to availability of basic and social infrastructure, there are multiple websites that provide ample information about properties. With the click of a button, you can see all the details that are important to you. In addition, by touring homes virtually, you can see many more than would be possible in a single day with your real estate agent.

2. Research the Market

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Take time to research the areas where you want to move into - the area¡¯s home values and the average selling prices for the type of home you are interested in purchasing. Ask friends and family for realtor recommendations and check out their credentials and online reviews. It's always a good idea to streamline your agenda and always prioritize setting up calls with real estate agent candidates to interview.

3. Consider Investing in Smaller Towns

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Investment properties in such locations might be better protected against different types of crisis, as small towns are generally less connected to the global economy. Look for alternatives, where prices are more affordable, and rental rates have not gone down a lot.

5. Check for loan availability online

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Visit websites of various banks and check availability of loans, the conditions, rate of interest, tenure and other aspects. Compare the benefits offered by each bank and choose the one that suits your requirement. Further, you can request the banks for a telephonic conversation or a video call to understand more about the credit offer.

6. Opt for online legal consultation

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Many legal firms are offering online legal consultation services. Make use of it. Check for the legality of the property papers and the viability of buying it.

7. EMI

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According to ET, don¡¯t stretch yourself. No matter how much you¡¯d love a fancy house, the EMI should not be more than one-third of your family income. That¡¯s the UPPER limit.

8. Create a financial cushion

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Retrenchments, salary cuts or delays in payout are inevitable outcomes of an unstable economy. Be prepared for the worst. Before you think of investments always think of additional contingency fund. Build a contingency fund to cover at least 6 months¡¯ expenses. This way you will not be forced to dip into your retirement savings in a cash crunch.

9. Understand the Real Estate Regulatory Act (RERA)

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Back in May 2020, the Centre issued an advisory to all states and union territories to treat the pandemic as an ¡®act of God¡¯ and suo motu extend the completion dates of projects. The government, in its statement, said that the extension of the timelines will protect the interest of homebuyers as they will get the property, though delayed by six months.

¡°This measure will save the projects and enable the developers to complete the projects within the revised time lines thereby safeguarding the interest of home buyers as it will ensure delivery of their booked flats/homes within the revised timeline. Delay of a few months is certainly better than not getting booked houses at all,¡± the ministry statement said.

Buying a home is a big decision, so it deserves to be thought about a deliberated. It is better to take some time before taking the leap, than rushing into a bad financial decision especially after how pandemic changed things.