The on-going economic uncertainties has made several aspiring home owners hesitant about taking a home loan and purchasing a home. A prominent question that baffles these home seekers is whether or not to rent out a place and await price correction?

For those considering of renting an apartment, there are several aspects to bear in mind. Firstly, the affordability of rental and a purchased property is mainly project and location specific. A person who is able to purchase a property in a certain location in a city won’t be able to pay the rent of an apartment at a post location in the same city.

Secondly, it depends on the future plans of the person whether he wants to buy a property or rent one out in any locality. Does he really want to settle down? Or is there an opportunity to save more and purchase a house in a much better locality? In this case, it definitely makes sense to rent an apartment.

If the individual is sure about a locality in his desired city and is committed to settling down there, the correct time to buy a home is right now. As real estate is booming, there are several on-going projects available in the excellent new residential areas and prices are still competitive. The correction in real estate rates looks weak, as demand for a movement of residential properties in several cities are healthy.

The ‘watch-and-wait’ strategy is only valid if there are informed details for anticipating an improvement in the real estate rate of a specific locality. Overall, the property rates will either climb or remain stable, depending on the area. Also, there are no projections of interest rates on home loans downsizing over the mid-term, going by economists’ predictions, inflation will continue to drive up the costs. However, post Demonetisation home loan interest rates are coming down.

Kotak has reduced the interest rate for Home Loan to 8.6%. From 1st December 2016 to 13th February 2017 it was 8.75% on the banner. Before Demonetisation it was 9.25 %. So in last 4 months Kotak Mahindra Bank’s Home Loan interest rate is revised twice.

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