Why making a woman homeowner is more beneficial than investing in gold, FDs for her

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Updated: March 8, 2019 6:11:19 PM

Millennial women are preferring earning through jobs, self employment or entrepreneurship to become financially independent, that leads to change the preferences and makes gold less lucrative for them.

dream home, buying home, ready-to-move-in property, completion certificate, GST, reduction in GST rate on propety, Stamp Duty, Registration Charges, home loan interest, affordable housing, women homeowner, stamp duty charges for women, gold, FDsThere is a spike in the number of women owning homes either as co-owners or sole owners.

Buying that dream home is almost everybody’s life goal. With increasing number of Millennial women preferring earning through jobs, self employment or entrepreneurship to become financially independent, there is a spike in the number of women owning homes either as co-owners or sole owners.

Financial independence is also changing the preferences of women, making gold less lucrative for them.

According to a consumer sentiment survey conducted by ANAROCK Property Consultants, nearly 42 per cent of women respondents preferred real estate as an investment asset class, followed by 30 per cent for FDs and a mere 17 per cent for gold.

“The 21st century millennial woman is progressive and increasingly financially independent. This had led to a distinct shift in her investment preferences – where gold and fixed deposits were the primary choices for Indian women, real estate now rides high in her investment portfolio,” said Anuj Puri, Chairman – ANAROCK Property Consultants.

“The rapid increase in women homebuyers across the country has also prompted the government to give them added benefits. To empower women of low-income segment as per the Housing for All by 2022 mission, the government has now made it mandatory for them to be either co-owners or sole owners of affordable homes,” said Puri.

Buying a house is a long-term commitment and apart from the cost of the property, it involves several taxes and duties, which may go up to 10-12 per cent of the total expenses, depending on the state and area in which the property belongs as the Stamp Duty varies from state to state.

The taxes and duties involved at the time of buying and owing a house includes Good and Services Tax (GST), Stamp Duty and Registration Charges.

GST is tax is applicable on all properties, except ready-to-move-in flats wherein sales took place after the issue of completion certificate. Giving relief to homebuyers, the GST council, in its recent policy meeting, has cut the applicable GST rate to 5 per cent from 12 per cent on premium houses and to 1 per cent from 8 per cent for affordable houses.

Stamp Duty varies from state to state and is between 5 and 7 per cent, while the Registration Charges are 1 per cent. Generally, in most of the states, Stamp Duty charges are lesser for women buyers than their male counterparts.

According to ANAROCK data, while the stamp duty for men is 7 per cent in Jharkhand, it’s Re 1 only for women. While UP gives Rs 10,000 discount to women homebuyers, they need to pay 2 per cent lesser Stamp Duty than men in Delhi, Haryana and Punjab. The difference in Rajasthan is 1 per cent.

Moreover, many banks offer discounted home loan rates to women as compared to men. This variation differs from bank to bank and goes up to nearly 1 per cent.

Further, working couple may avail certain tax benefits, as both can claim tax deductions individually.

So, availing lower stamp duty charges and low home loan interest rates by making a woman the homeowner is more beneficial than investing in gold and FDs for her, as there will be hardly any benefits apart from saving some long-term capital gain tax in case the gold is disposed off.

However, while making wife sole-owner of the house to avail benefits of lower Stamp Duty charges and home loan interest, it should be kept in mind that the ownership right will also be with the wife, which in case of marital separation, may result into loss of the property itself.

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