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25 MAY, 2021
The COVID-19 pandemic has impacted almost every sector, including real estate, bringing a massive transformation in the business of buying and selling homes. Also, a large number of potential homebuyers are confused as to whether this is the right time to purchase a property or not. Simply put, the answer is “Yes”. Despite the economic slowdown, there have been many favourable factors that indicate that it could be the right time to buy a house. Here are a few reasons why you should consider buying your dream home amidst COVID-19 pandemic.
8 Reasons to Buy a House Amidst the COVID-19 Pandemic
Several homebuyers are apprehensive about buying a property in these times due to the uncertainty regarding their source of income. This has resulted in lower buyer competition, and you can make the most of it to find a house in your preferred location. Also, lesser competition will give you a better chance to negotiate affordable deals.
Property prices have dropped significantly due to the COVID-19 pandemic. Uncertainty of loan repayment due to financial constraints faced by many borrowers is one of the reasons for this drop. Moreover, due the cash crunch faced by many, the demand for house property has decreased. This could be due to the distress in the businesses and salary cuts of prospective homebuyers. Both these factors have made it easier to find affordable houses.
Due to the coronavirus outbreak, many homebuyers and sellers have decided to stay away from purchasing and selling house property. The fall in the demand of house property has reduced the resale value too. There has been a significant decrease in the repo rate during the pandemic. The Reserve Bank of India’s repo rate stood at 5.15% in Dec 2019, which came down to 4% in Feb 2021. Due to this, many banks and financial institutions have also slashed down their home loan interest rates. From a range of 8-9% in 2019, the interest rates on home loans have come down to 7% and less amidst the pandemic. You can make the most of this reduction and buy your dream house now.
The government has announced various fiscal incentives to homebuyers during COVID-19. For instance, the Maharashtra Government reduced real estate premiums by 50% to make buying homes cheaper. Earlier, the Maharashtra government decreased the stamp duty charges to uplift the real estate sector hit by the COVID-19 pandemic. Also, for people availing home loans under the PMAY scheme, the deadline for the Credit-Linked Subsidy Scheme (CLSS) has been extended by one year.
You can make use of virtual technology to meet real estate agents, home sellers, and lenders. It’s also possible to take virtual tours of the home you intend to purchase.
Once things return to normal, property prices are likely to increase. So, purchasing a house during the COVID-19 pandemic can not only help save a large amount of money but also fetch a higher return on investment if you wish to sell your property later on.
Various lenders have relaxed their home loan eligibility criteria for encouraging potential homebuyers to purchase a property. Moreover, if you have a good credit score, you will be able to avail a comparatively higher loan amount to finance your property purchase.
Due to the decrease in demand, lenders have put out better deals to attract prospective home buyers. While better deals from banks include concessions in interest rates, developers are also offering deals like complimentary car parking, waiver of society-related charges, easy payment plans, etc.
Keeping all the above-mentioned pointers in mind, it can be said that purchasing a property amidst the COVID-19 pandemic can prove to be a lucrative deal in the long run. However, before you go ahead and buy your dream house, ensure that you have employment stability during these trying times. Also, evaluate your repayment capacity carefully and settle for an EMI and loan tenure that suits your budget. Lastly, make sure to go through the home loan guide to understand the nuances and clauses set by the lender before availing a home loan.
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