Why 2021 is the Best Time to Buy a Home in Your Favourite City?
The year 2021 has not had the best start. As if the global economic slowdown was not already troubling the world enough, we now have a global pandemic in the form of COVID-19. Conventional wisdom might suggest that this is not the best time to make any large ticket purchases. Yet if you look at the situation very carefully, you will find that this is the perfect time to buy a home in the city you have always wanted. If you have been looking at a property for some time now, this is the correct time to seal the deal. If you have not finalised the property yet, now will be the time to speed up your property search.
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Let us look at some of the reasons why 2021 is the best time to buy a home in your favourite city.
RBI keeps on cutting interest rates: In the 15 months, the Reserve Bank of India has cut down the repo rate drastically with an undeterred aim to boost consumption in the economy. Earlier this was to prop up our slowing economy, but with the coronavirus induced shutdowns practically grinding the economy to a halt, RBI has already brought benchmark lending s to an all-time low of 4.4.0% with a 75bps straight repo cut. Further, once the economy starts moving again, we can expect deeper cuts in the repo rate. This has all but confirmed that Home Loan Interest Rates will continue to go southwards. Surely, this is the time to apply for Home Loan for the property you have always wanted.
Markets are bleeding, redirect money: Stocks and financial markets in India were not performing well before the coronavirus problem, and now it has blown completely out of hand. The lockdowns have created a situation where stock markets and financial products will continue to be in considerable turmoil for the foreseeable future. Unless you have an exceptional appetite for risk, the best bet is to focus all your funds to safer directions. Real estate has always been a safe investment haven when compared to all other options. Now seems to be the perfect time to Apply for Home Loan and club it with your savings to buy a home you have always dreamt of.
Pradhan Mantri Awas Yojana: The government of India has launched a subsidy scheme for people who want to buy their first home. Pradhan Mantri Awas Yojana provides a huge subsidy on the interest component of Home Loans. Considering the prime objective of this scheme is to provide housing to all by the year 2022, and the fact that this subsidy can be obtained by a very simple procedure now seems to be the time to buy a house in the city of your choice. You pay so much tax to the government; let them help you achieve your goal.
Tough competition between lending firms and banks: The recent times have seen a lot of competition between banks and NBFCs. With the increasing use of technology and competitive lending procedures and practices, a high number of people are choosing NBFCs for their Home Loan requirements. Banks have also tried to match up to the increased competition with innovative lending methodologies and using mobile phone apps and the internet to improve their reach to prospective customers. This competition works in favour of home buyers.
RERA has brought in buyer confidence: Real Estate Regulation Act or RERA has been formed recently in many states, including all the urban property hotspots in the country. Gone are the days of rolling delays in many projects. Before the RERAs were active, many projects were delayed by double or triple the duration they were supposed to be delivered in, which resulted in downgraded customer confidence. This has changed now for the better.
Labour costs are down: Considering that coronavirus has created labour mobility challenges across the country, for some time getting low-cost labour might not be a challenge. This is especially welcome for the people who will buy either unbuilt homes or semi built homes and will need to get finishing work done on their homes. With labour costs seemingly low for the coming few months, now will be a good time to get your dream home and get it all decked up. As the housing market opens again, labour will go in short supply in the midterm till people from manpower supply states come back to urban areas to balance out the demand. So now will be the best time to get started.
Rural property will go up in demand, making urban properties cheaper: A lot of people are expected to start looking for property in semi-urban areas or rural areas for some time where they will get this sense of security in seclusion. Add to this, the fact that rural and semi-urban areas do not cost as much in property prices as urban areas, demand for urban property will slow down, turning it into a buyers’ market. If you want to buy a home in your favourite city, what can be a better time!
Increased housing supply: We still have a lot of housing supply, which came in because of people not buying due to the economic slowdown in late last year and very early this year. As a result, there is enough extra housing supply in urban areas to provide a good choice to interested buyers.
Rent prices do not make much sense anymore: With falling Home Loan interest rates, expected decline in property prices, increased housing supply, and a much clearer regulatory environment, renting a house might not seem like as good a factor as it seemed some time back. There has never been a better time to buy a residential property in the city of your choice.
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