• Luxury Apartments: Buying vs Rent.

    Decisions about property are always quixotic. They have always been. Numerous perspectives and variables go into making a decision of virtue. Buying an apartment or renting one must be quite a choice in today’s lifestyle driven economy. While own homes provide the flexibility in design and an independent gambit in financial wisdom, rent homes are a classic example for Opportunity Cost (one could rent a home and thereby utilize funds in investing on other assets). Until recently, popular sense mandated that a own home is a sign of financial stability, the idea is now being reconsidered.

    More than ever, people today understand that renting a home is not “throwing away money”, we are getting to live in it and have the viability of moving out to a better home rather easily.

    Here are 5 facets to look into to make a wiser decision, buying or renting a luxury apartment.

    Need or Want?: A need is the plan for survival. A want is one step higher which one can do without, but desires to have. One should have an all compassing sense as to why he/she is choosing to rent or own a home. Location, convenience, long term vision and affordability are some factors. A Want may not be an ideal reason to make any decision. Not homes for sure.

    Creditworthiness Owning a property on loan requites credit worthiness. Meaning, one should prove to be able to pay off the loan within a stipulated time frame. Generally a CIBIL score of 750 is considered fine and anything above makes for a more straightforward formality.Generally, the down payment to own homes is from 3 % to 20 % of the total value of homes after which the buyer pays EMI over a sustained period of time.

    Market Volatility: If one observes, the market conditions are never the same over a span of time. They change often. Owing to many factors, primarily demand and inflation, one could find a buyers market and sometimes, a seller’s market. At times it is neutral too. Keeping tabs on the interest rates may make for good sense as even a small decrease in interest of one percent makes for a huge sum of money over a long time. At most times this sort of saving is in the good weights of six figures.

    Opportunity Cost: One could do well to analyze how much one could earn with the down payment and EMI money in the future and how much the same property could cost in that time. Often times, Opportunity Cost is neglected in the veil of emotion. However, we all have different mindsets and aims.

    Family Order: If the area you are looking to move in costs a hefty sum, you could do well to rent a home than own it at a larger expense. Convenience plays a large role in making smart home decisions. There is nothing like being in a home where Work, Play and Leisure are all in real proximity.

    It is definitely a personal decision to own a home or rent one, here’s hoping you make an informed choice in pertinence to your long term plans and lifestyle changes in the future.

     

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