Buying a home is a major accomplishment in one’s life. People work hard their entire lives to live in a home that they can call their dream home. When it comes to saving for a down payment on a home, the earlier you begin, the better. After all, each and every dime matters! If you’re still living with your parents, you can simply start saving for a house.
Even saving for a down payment, though, is difficult. Fortunately, there are a number of things you can do to make the process of purchasing a home go more smoothly. Here are some of our best home-buying money-saving strategies to get you started.
Assess your budget
Determine how much cash you’ll need to purchase the home of your dreams. Consider the additional costs you’ll incur, like registration and stamp duty fees, interiors, and upkeep, to name a few. You’ll know what you’re aiming for in this manner, and knowing what you’re striving for will make planning easier. If you intend to take out a home loan, you must set aside at least 40% of the property’s cost to avoid financial strain on your monthly bills.
If you’re wondering how much to save for a house, you should first determine how much money you want to spend. Also, keep in mind that you’re not just saving for a down payment on a house. You may also need to purchase furniture and pay the costs charged by the real estate agent or broker. As a result, make sure you establish a realistic goal – one that you can attain in a reasonable amount of time and that offers you an inexpensive mortgage with the shortest term available.
Hire an experienced real estate agent
Using a trustworthy and professional real estate agent who is familiar with the region can help you save time and money. This is particularly crucial for first-time homeowners since a qualified real estate agent can guide you through the process and identify cost-cutting opportunities. Family, friends, and neighborhood residents can often provide recommendations for reputable brokers, as an online real estate site.
Invest in instruments that generate income
To accumulate a corpus of Rs 50 lakh or more in the following ten years, you’ll need to invest in a variety of money-growth instruments that will help you earn a reasonable rate of return over time Investing in mutual funds, Public Provident Funds (PPF), or fixed deposits (FDs) are all options. Mutual funds can help you earn 10-18 percent returns depending on the policy you choose. PPF, on the other hand, pays a compounded yearly return rate of roughly 7.6%. The best part of investing in a PPF is that you may start with as little as Rs 100 to register an account. Unlike mutual funds, PPF investments are completely risk-free.
Chop down your debt
If you’re attempting to buy a house, diverting your extra cash to your debt may seem counterintuitive. Your debt-to-income ratio, on the other hand, is one of the first things lenders consider when evaluating you as a mortgage candidate (DTI. The more debt you have, the less appealing you are as a candidate. This could lead to higher interest rates and a greater need for down payments.
Take some time to pay off your debts before applying for a mortgage loan. Examine your credit cards, student loans, personal loans, and auto loans to determine how much you owe and devise a repayment strategy.
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Explore under-construction properties
While purchasing a ready-to-move-in home may seem enticing, these homes are more expensive. Buying a house that is still under construction or that requires finishing work is a better economical alternative if you can afford to wait. Check the developer’s RERA registration and track record before buying an under-construction home. Choose properties in developments where the developer has purchased title insurance. Builders in Kakkanad offer excellent under-construction property solutions.
Reduce your household expenditures
The first thing you should remember is that paying high rent while saving for your own home is never a good idea. Small things like turning off lights, unplugging chargers, and shopping around for the best TV, internet, and phone contracts may seem insignificant, but they can add up to significant savings over time. Even if these charges appear insignificant, a little research and thinking can help you limit wasteful spending. Spend time exploring alternatives to expensive things when purchasing them. If you must purchase something, do so around the holiday season as you are more likely to receive better deals!
If you do good research you can find budget-friendly builders in Kerala who can give you your dream home at an affordable cost. Be consistent in your savings and you’ll be able to achieve your goal of owning a home.