8 Benefits of Buying a House While You're Young

Larger disposable incomes, consumer-friendly loans with multiple payment options, the desire to stop paying rent and easy access to information are just some factors that have contributed to an increase in the number of youngsters buying homes.

With millennials beginning to earn their own money in their early 20s, most people have taken a home loan even before the age of 35. However, these young investors are not just looking at property for security reasons.

Here are 8 benefits of buying a house at a young age.

  1. Make the most of your income:Taxes can be tough. Most of us enlist a CAs’ help to understand how we can get the most out of our income and avoid unnecessary tax.Well here’s a suggestion that you could present to your CA. Applying for a home loan and buying a house gives you tax exemptions under both Section 80C & 80EE of the Income Tax Act.The best part yet, is that these deductions can be claimed until the loan is completely paid off. Claiming these tax deductions at a young age gives you more from your income.
  2. Take advantage of step- up facility and consumer –friendly loans:These days’ lenders are encouraging buyers to invest in real estate. There are a number of schemes and loans that actually make it easier for the consumer. One such facility is the concept of ‘step-up EMI’.Here your loan EMI is proportional to the expected growth of your earning capacity or income. Therefore the EMI amount gradually increases, allowing a buyer to pay less EMI initially while still owning a house.This works best for those who are in a stable job, not looking to make any drastic changes.
  3. Make use of the fact that you are more eligible for a loan:Youngsters have fewer financial obligations than older people. Money lenders take into consideration a buyers Fixed Obligation to Income Ratio (FOIR) i.e. – the proportion of your income currently being used to repay fixed obligations such as credit card bills.Since there are fewer financial obligations, and a lower FOIR, it indicates to the lender that the chances of a buyer defaulting on payments is far less.Additionally, being young implies that you have a longer active work life ahead of you, giving you enough time to repay the loan.
  4. Take your time to repay your loan:When you buy young, you can avail a longer repayment tenure. This distributes your loan obligation over a longer period of time. Therefore, your EMI will reduce, giving you the space for other financial commitments.
  5. Begin your commitment as soon as possible:For most, buying a home is a lifelong dream. It is one of those things that a majority of people definitely want to do in their lifetime.If you have the same dream, wouldn’t you want to begin this large financial commitment as soon as possible?Beginning the process earlier allows you to finish sooner as well and relax after.
  6. An additional source of income:They say nobody ever became a millionaire by working a 9 to 5 job. While one home on rent may not make you a millionaire, receiving an extra income in the form of rent, would certainly help cushion your bank balance.
  7. Low Risk High Returns:With thorough research and a reliable builder such as Scapers you can rest assured that your investment will be worth every paisa.If researched well, real estate is a low-risk investment especially if compared to other investment instruments such as mutual funds and shares.Apart from being low-risk, real estate also promises high returns. With land prices constantly increasing there is a large possibility that your money is not just safe, it also multiplies over a period of time.
  8. A future asset:As mentioned above the value of real estate appreciates over time. Having a house works as a future asset. You can sell it in times of crisis and use the income to both buy a new house and fund the crisis.The earlier you buy the longer the duration your home has to appreciate in value. That apart, knowing that your family has a roof over their head gives one a feeling of safety and security.


8 Benefits of Buying a House While You’re Young

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