Analysts and industry watchers feel that there is no such thing as a 'right' or 'wrong' time to buy property. Looking at the uncertainty prevailing the markets, it is better that you buy a house as soon as you can, especially if you plan to make it your home.

At the moment, the market conditions are uncertain. Many people who have been planning to buy a home are indecisive. They all have a common question - should they buy the property now or wait for some time to get better deal? Analysts and industry watchers feel that there is no such thing as a 'right' or 'wrong' time to buy property. This is especially so if you are buying a house for yourself. Here are some reasons why it is better to go ahead and buy as soon as possible if you are looking for a home for your own stay:

LIMIT TO LAND AVAILABLE

The first and most significant reason is that there is a limit on the land available in any given location. Land is something you cannot manufacture. The population is growing every day and the number of buyers will increase for any piece of land over time. Hence, it makes sense to invest in property anytime.

There are many NRIs looking for residential property here. Investors from abroad too are looking at buying property here. All this drives the market and you cannot expect land to remain without demand for long periods of time.

COSTS ON THE RISE

The raw material cost to build a house is rising every day. Over the last six months, the cost of steel has gone up by 30 percent. Needless to say, prices of cement and labour are also rising. Thus, again, it makes sense to build sooner rather than later.

EARLY MOVER ADVANTAGE

Everyone takes a loan to build or purchase their dream homes. People who construct or purchase a home early in their life get more time to repay the loan. Also, they enjoy more flexibility as usually people face many large expenses in the latter part of life (children's education, marriage etc)
TAX INCENTIVES

The government has provided tax incentives on the interest and principal repaid to housing finance companies against a home loan. This again encourages people to invest in residential properties sooner in their life.

PLAN EXPENSES

In these conditions, it becomes very important for home buyers to plan their finances carefully. You should budget for the equated monthly installment (EMI) commitment that is required to repay the loan. Since the EMI is one of the major cash outflows every month, it is very important to identify and plan the short-term, medium-term and long-term cash requirements. For example, day-to-day expenses, fluctuations in EMI payments, children's education, children's marriage, savings for retirement etc. Also, you need to plan for some contingencies - to fund unforeseen events.

Banks offer a host of options - step-up and step-down, for example - in their home loan options. They tailor the EMI amount to suit your needs. You can look for these options while signing up for a home loan.
Courtesy:- ET dtd:- July 11, 2008