7 things to know while buying a home
Buying a house is one of the most important decisions of life for most of the people. This is so because most of the people in our country who buy a house does so only once or twice in their life time. House is one product which consumes a large portion of of one’s lifetime income.
Inspite of it being such an important decision, the consumer buying behavior in case of a housing property is not that much evolved. The consumer buying behavior is more evolved in case of buying a TV / Music system than in case of buying a house.
Most of the home buyers, while buying the house focus on only 4 aspects – 1. BUDGET 2. LOCATION 3. NUMBER OF ROOMS / SIZE OF THE HOUSE 4. TYPE OF HOUSE . Lets have a look at these ‘very obvious’ aspects that people look at, while buying a house.
BUDGET – This is the first aspect / point taken into consideration. People know how much amount they can contribute from their own sources.Viz. savings, parents, investments, etc. Then they check out how much home loan they can avail. Thus they arrive at the sum total, which stands as their budget.
LOCATION – This is one of the most initial aspect looked at. More than 90% customers zero down on one or two or three locations in the city where they want to buy property at. The things which evolve this decision are – personal liking of the location , relatives or friends staying in that location, proximity to place of employment etc.
TYPE OF THE PROPERTY – What kind of property that one wants to buy – apartment or a tenement or a bungalow or simply a piece of land. This is most of times governed by the budget/ affordability aspect. This is many a times decided once the customer starts searching for property and then understands the prevailing market prices.
SIZE OF THE HOUSE / NUMBER OF ROOMS – This is a very initial level decision. Most of the people are fence sitters on this aspect . For eg they look for either a 2BHK or a 3 BHK flat etc. However, for most of the home buyers, the aspects which govern their purchase decision get over with these four aspects.Lets look at the 7 things other than these 4 ‘ very obvious’ aspects , that every home buyer should look at while buying a home -
1. CHOICES AVAILABLE AND COMPARISION – Once you zero down on the preferred locations, visit as much as possible, ongoing projects in these locations. Also prepare a comparison chart for all the properties that you visit. Even though you like the first property that u visit very much, make sure that you visit ample number of properties before you finalize. We would also suggest that one should also existing properties available for RESALE in the given area. Who knows where you can strike the right sized , right priced, right choice property. Most of the customers visit only 3 to 4 properties before taking the decision. The right number can be anything between 7 to 10 properties. Any given location in baroda would have more than 10 options for any type of , any budget of property.
2. VICINITY TO SCHOOL, HOSPITAL, POLICE STATION, RAILWAY STATION, MARKET FOR DAILY USE PRODUCTS, RELIGIOUS PLACE, ETC – This is a major aspect that one should look at while buying property as it would impact day to day life.The more the near vicinity to these amenities, more is the convenience available in daily life, however it also means that more is the probability for higher price.
3. POTENTIAL FOR FUTURE DEVELOPMENT OF THAT AREA – Look at how has that area developed in last 10 -15 years. Check if there are any major industries / companies / places of employment in that location. Check what are the plans of the development authority for the development of that area. Try to guestimate what that area /location would be after 10 years. The more the chances of commercial development of that area, the more the chances of appreciation of that property. For example all properties on old padra road / akota has seen much higher appreciation than properties on waghodia road / ajwa road / tarsali area.
4. POTENTIAL FOR APPRECIATION OF THAT PROPERTY – Always remember – ‘Land is the only Asset in world which Appreciates ’, all other assets depreciates with time. So the potential of appreciation of land is much more than an individual house / bungalow which has higher appreciation potential than an apartment property. Also try to guestimate about how much will the property appreciate in next 10 years.
5. QUALITY OF CONSTRUCTION – This is a very easy thing to check when you are buying a ready property. If you are buying a property which is under construction, check the quality of construction in the past projects of that developer. Visit the past projects of the developer and check the quality. It is very likely that it would be similar for your project also. Try to meet the site engineer or the architect and understand the project details from them. Inquire about the materials used in construction.
6. ACTUAL PRODUCT – Developers generally sell property on per square foot price. However what is that ‘ square foot’ ? There are three different units of ‘ area’ in the property market. Viz carpet area, built up area and super built up. Developers generally sell properties on ‘ super built up’ unit area. Check what is the actual carpet area that you are getting.
7. HIDDEN COSTS / OTHER CHARGES – Clarify all the hidden costs / other charges on which you would be spending money till you move into that property It is very likely that the cost escalates by 10 -15% many a times.
Looking at these 7 aspects is equally important as of the 4 ‘very obvious’ aspects, while buying the home. Remember , buying home is one of the most important and impactful decision of your life.
Abhijit Bhagwat, the writer of this piece is a Real Estate and Mortgage expert. He has an experience of 8+ years in the field of Real Estate, Mortgage Loans, Financial Services and Banking across Maharashtra, Gujarat, Rajasthan and Karnataka. He served with ICICIBANK in various capacities for 7 years.