Questions you should ask yourself before buying a Home!
Should You Really Buy a Home? Or Just the Nameplate on It?
Do you really want the home or do you really want just your name on the home?
Ask why you are buying a home? This is the most important question. You maybe in a simulation of unconscious? Is the need real or are you just trying to mimic because someone is buying? That you will get instant appreciation, fame and status in your circle of neighbours, friends and nephews? Basically you are chasing the dopamine hit overall?Are you going to live in that house for your whole life or not?
You are buying it just to stay for more like 5 to 10 years and move somewhere? This question comes from how close that city is, people in that area and more? How confident are you that you are happy to stay there your whole life? If you retire and do not work, will you be living in the same home?How many income streams do you have in your home currently?
If there are 2 or 3, then if one loses their job in this market, another could help? Does your EMI go more than 50 to 70% of your income? Are you ok to leave all the extra materialistic things, things you dreamed to buy when you have high salary and more? Are you ok to leave all of them for the home you are buying?Write the calculations, know the calculations.
How much does the house cost? How many years loan are you taking? If you take 20 years of tenure then you are paying 2x of your money to the bank? Are you ok with that decision? Are you ok to pay 3x of your home cost?If and all you had a situation that you gotta leave the home you bought in the next 5 to 10 years...
Nobody is living, you got a job in another city, your parents need connections and friends so they are living in the hometown mostly maybe with your sibling? Now does the city you bought the home have value to rent it at a better price? Do people move to that city often for employment and many things happening in that area?If and all you had to move to another city in 5 to 10 years and your loan is of 20 years tenure...
Are you ok to rent it to another person? Because you bought it with lots of emotions and it's your only home? Does this make any sense? Even if you rent it out, if your EMI is 60 to 80k and the maximum rent you get is 30 to 40k, are you ok with that? You will be living in another city home where you are paying another 30 to 40k home rent? Are you really ok with that?Think more than 1 year before buying a home...
Because more people buy homes which they don't want and which they are not able to pay, than people who are actually able to buy? This is the most family generation defining thing? Why because the wealth currently going to buy a home is literally many Indians’ whole net worth or FIRE number? If you make a useless decision and buy a home even if you are not able to afford, you are mitigating or delegating your savings to buy an asset that might not fulfil your whole life? Usecaseless? And maybe this is not the happiness you wanted?If you want to live in a better home the 1st step is to rent a better home.
First rent out a better home, live a better life, have better food, have a better lifestyle, have some fulfillments which you dreamed from your college life or more? Spend some money on experiences and explore the world, maybe YOLO? Save some money for the future? Now if everything is going fine and still if you have money then think about buying a home? Until then enjoy the joy of living and experiencing? You are not living to see the desktop screen for 9 hrs, paying EMIs and being a robot? Get better lifestyle first, no one knows when your job goes off?If you ask me should you buy home even after thinking about all these questions...?
Then I would say no.
And if you wanted to know why I say real estate is overrated in India → read this ↗