Real Estate Purchase Outlook 2014: Owning a home on EMI vs renting a house

Real estate trends, even globally have always been sentiment driven. These sentiments could be investment related or about fulfilling a basic emotional need. Either ways saying that real estate trends are dynamic in nature would be an under-statement. One of the most essential questions in this segment is whether to rent a home and or to buy one. The answer to this question is not as complicated as it is detailed. Ultimately, the answer to this question depends upon when you are planning to buy a home.

Quickly re-capping the last year's performance; the government took quite a few initiatives to promote the first time homebuyers to invest in properties. The declaration which involved increasing the home loan exemption limit from Rs. 1.5 to 2.5 lakhs was a clear push for first time home buyers. Reforms of this nature have ensured that buying a home is no longer just an emotional decision anymore for first time home buyers.

Real estate sales have improved in recent months because of launches in the affordable segment and the fact that developers were willing to reduce prices. Evidently, over the past few quarters, the overall real estate market in India has started to show considerable amount of stability in property prices. According reports from CREDAI, homes in the INR 30 lakhs - 60 lakhs bracket is one of the most popular options for home buyers.

Looking ahead, favorable regulatory reforms that are most likely to be implemented in the coming months which would promote transparency, single-window clearance, tax regime reforms and reduction in human contact in the approval process are also some of the positive indicators for upcoming seasons of home buying.

Homebuyers should take into consideration that timely investment into new properties in favorable locations will yield highly beneficial returns. According, to investment experts the overall appreciation value in the next 3 years could see steady growth. Indicating that a calculated and timely real estate purchase in the coming months will be a smart move! For the masses that bear the brunt of landlords increasing the house rent or those who feel that they are paying too much; attractive home financing offers are proving to be a boon.

Even in the upcoming seasons of budget reforms and elections, the majority market sentiment between paying an EMI vs paying rent seems to be tilting towards paying an EMI and owning a home. With real estate purchases, the best decisions are often a union of both emotion and logic.

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