A growing number of Indian women are breaking stereotypes, by making a living on their own and leading independent lives. This drastic transformation in their lifestyle has led to renewed priorities for these women. A record number of financially independent single Indian women are now buying a home of their own. It has been estimated that one fifth of home buyers in India today are single women. Experts suggest that around 30 per cent of the property buyers in urban areas are now women. In a few years, this figure will only spiral upwards. Add to this, single home owners stand to gain maximum tax break as compared to married couples. Single women taking the plunge to buy their first home, however, need to be aware of certain key aspects to make it a secure and profitable deal.
Plan and buy
Planning and budgeting are the core prerequisites of any expense. Taking a stock of your finances is pertinent while buying a house. This will be the most valuable possession of your life. The kind of house you buy should suit your financial capacity and planning. To begin with, a first time home buyer must keep in mind that this won’t be the only home she will ever buy. One must always leave room to upgrade in the future. Hence, you must freeze on a property that fits into the budget at that given point in time. Going overboard with an expensive flat at the first go is clearly not advisable. Compromising on your financial feasibility is the biggest mistake you will make while buying your first home. You don’t want to be burdened with a hefty EMI. There are numerous options in the affordable housing space. Purchasing an affordable house won’t put a strain on your finances.
Look before you leap
One needs to invest adequate time in extensive research before zeroing on a property. A lot of information is available online. Moreover, most developers have websites featuring details on the status and features of their projects. While online research is helpful, personal recce cannot be ruled out. Living all by yourself calls for caution. Examining the safety and security of the area where your dream home is located is vital. You must also ensure that your new home is strategically connected to key locations and possess basic amenities, as promised by the developer.
Research to choose the right lender is essential. Scrutinize the multiple feasible loan options available for you. With major banks vying to woo customers with attractive loan schemes, the home loan market is experiencing a competitive phase. Remember that as a woman you are now entitled to a lower interest rate. The current rate of interest for women borrowers is 20 bps above the base rate of 9.3 per cent.
Single women applying for a loan should inquire not just about special interest rates, but also other incentives that are being offered to women borrowers. Negotiation is the key. Don’t just settle for the first scheme that is offered to you. Most of banks have a considerable margin of flexibility to accommodate borrowers who know what they want and are determined to get it. Not just banks, but non-banking financial institutions have caught up with the trend of single women buying homes. They are wooing women customers by launching a separate home loan division, where salaried and self-employed women can get home loans of ₹2-12 lakh to purchase affordable housing units. Interest rates are in the 10-13 per cent range. Don’t forget to research on the several different lending institutions as well. Try not to seek recommendations from friends and relatives. Ideally, you should get pre-approved for a home loan where the interest rate is the most competitive. With the best possible lending rate, you can devise a lucrative deal for yourself.
Don’t stretch your purse strings
First time home buyers tend to be overwhelmed with choices. They also try to stretch their purse strings in one go. As mentioned earlier, a single woman needs to gauge her financial bandwidth before buying a home. Knowing ‘what you can afford and spending accordingly’, is a sign of an intelligent buyer.
Insure your new home
Since property unlike stocks doesn’t lose value overnight, real estate is viewed as the best financial security plan. One cannot rule out contingency factors. Insurance is necessary to safeguard your property. A new home will require structural and home loan insurance. Opt for an insurance provider which offers endowment plans with adequate cover and is cost effective. If you aren’t planning on moving into the new house anytime soon, then the best option is to rent it out. Rent will get you steady income which can be diverted towards paying EMIs.
A financially independent single woman lives life on her own terms. Buying your first home by weighing all options wisely will make it the best decision of your life.
The author is AVP Sales & Marketing , Tata Housing Development Company Limited