DNA Explainer: Is this the best time to buy your dream home?

If you are looking for an investment option, this is not just the best time to invest in gold but also in property. So if you do not have your own house, here is a golden opportunity to own one. Several banks and housing finance companies have announced cuts in their home loan rates recently.

This not only means that you have to pay lesser interest rates on a home loan but also that there is a growing demand for new home loans which has resulted in this cut in rates. And banks along with housing finance companies are making full use of this opportunity.

Experts are of the opinion that for prospective home buyers this is an ideal time to invest in buying a house as the interest rates have lowered and builders are also offering discounts after going through loss due to the ongoing COVID-19 pandemic.

What led to this ideal situation?

Demand for property rose in the period between October 2020 and March 2021 following the first wave of the COVID-19 pandemic. 

A cut in stamp duty by several state governments, discounts offered by developers, and low-interest rates led to an increase in demand.

However, the situation suddenly changed due to the second wave of COVID-19 and this pace slowed down in the quarter ended June 2021.

The demand picked up again over the last couple of months with improvement in the pace of vaccination and a rise in economic activity.

Industry players say that with work from home becoming the norm for many service sectors, individuals are now looking to buy a bigger house.

There is a paradigm shift post-COVID-19 as many who were comfortable living on rent, now feel the need for their own home.

Why you should buy your house now?

If you have been saving to buy a house, this is a good time to invest as there is enough supply.

The developers are also looking to increase sales to boost cash flows and hence are offering discounts.

Several banks and housing finance companies are offering attractive interest rates on home loans. 

Apart from a lower EMI, a bigger advantage is that a lower interest rate increases the eligibility of a customer.

Developers are under stress as construction activity dropped by around 40% because of the COVID-19 situation.

However, experts say that homebuyers must go for ready projects when looking to invest in property.

Industry experts feel prices will not rise soon as developers are looking at pushing sales to improve their cash flow.