Home Loan Rates At Their Lowest - Why This Is The Perfect Time To Buy A Property In Thane?

The idea that "owning a home is a pillar of riches, both financial opulence and emotional security" is currently quite popular. While many people wish to own a Property in Thane, it has taken a second seat in the world of choices of being adventurous and spending on extravagance.

In the midst of the COVID 19 pandemic, there is a rising recognition that, when compared to other financial possibilities, house ownership provides stability and security for families. When people are struggling to find work and security, owning a home and not having to pay rent is far more secure.

Affordability is determined by three factors: the house price, income levels, and interest rates on home loans. For the previous five years, house prices of Residential Properties in Thane have remained practically unchanged, assisting in the improvement of home affordability.

Several banks and housing finance providers have announced house loan rate reductions in the previous month. While the cut reflects the economy`s abundant liquidity and low-interest rates, it also indicates a growing demand for new house loans, which neither bank or HFC wants to lose out on. Given the discounts offered by builders and the low mortgage rates in the economy, industry analysts believe this is a good moment for prospective house buyers.

So evidently, unlike other asset classes, owning a Residential Property in Thane has become a vital part of people`s lives and a real investment, increasing the buying trend.

Benefits of Purchasing a Home in 2021

This could be a great moment to buy a Property in Thane if you`re a first-time buyer or looking to upgrade your lifestyle. There are two important considerations in favour of home purchasers from a purely financial standpoint: reduced home prices and lower cost of credit to acquire a home.

To begin with, in 2021, housing prices are expected to continue under pressure. According to a Reuters survey of 12 analysts conducted between May 11 and May 19, average house prices this year would remain constant from 2020, a reduction from a previous poll conducted in January, which predicted a 1.3 % increase.

According to data from real estate firm Knight Frank, average property prices declined in six of eight major cities in the first quarter of this year compared to the same period last year—even before the second wave of COVID-19 hit the country.

Low interest rates are also advantageous for people seeking house loans from banks and financial institutions. The repo rate of the RBI is now at 4%, substantially lower than it was in early 2019. (6.5 % ). And rates are likely to stay low as the RBI continues an accommodating monetary policy in the face of the pandemic`s economic hurdles. Lower policy rates have resulted in a drop in bank and financial institution lending rates, particularly home loan rates.

In a nutshell, this indicates that purchasing a Residential Property in Thane now may be a little less expensive than you had anticipated. If you`re a woman, there are a couple additional advantages in store for you. Beginning this fiscal year, women homebuyers in Maharashtra will pay a percentage point less in stamp duty. The state joins the likes of Uttar Pradesh, Bihar, Punjab, Haryana, and Delhi in having lower stamp duty for women than for men.

Home Loan Rates Have Never Been Lower

Home loan interest rates have dropped to their lowest level in nearly four decades. In fact, top institutions like Kotak Mahindra Bank are already offering rates as low as 6.65%.

Reduced interest rates mean lower EMIs for borrowers, which can result in significant interest savings over the life of the loan. For example, an EMI of Rs. 43,970 for a 15-year loan of Rs. 50 lakh at 6.65% is roughly Rs. 6,744 less than what a borrower would pay if the interest rate was 9%, as it was in early 2019. If interest rates remain unchanged, this translates to more than Rs. 12 lakh in savings throughout the loan`s term.

Leading banks also offer a variety of financial and non-financial services to homeowners these days. For example, Kotak Mahindra Bank provides a slew of services to make the process easier for homebuyers, including no processing fees, doorstep service, and home loan insurance.

Why Has There Been An Increase in Housing demand?

Following the initial wave of Covid-19, housing demand soared in the two quarters between October 2020 and March 2021. It was aided by factors like stamp duty reductions by various state governments, developer discounts, and low financing rates. Following the second wave of Covid, the pace slowed in the quarter ended June 2021, but has picked up again in recent months, thanks to broader economic opening, improved immunisation rates, and more economic activity.

Is Now a Good Time to Purchase a Residential Property in Thane?

This is an excellent moment to buy Residential Properties in Thane if you have been saving for it. It is a "buyers` market" because there is sufficient supply, and even the developer is eager to enhance sales to improve cash flow. Interest rates, on the other hand, are appealing. Aside from a cheaper EMI, a lower interest rate boosts a customer`s eligibility. For example, if you are eligible for a loan with an EMI of up to Rs 50,000, you can borrow Rs 60 lakh at an interest rate of 8%, but the loan amount can be increased to Rs 66 lakh at a lower rate of 6.7 %.

Developers are under pressure because construction activity has plummeted by roughly 40% as a result of Covid. It`s a fantastic time to buy, but first-time buyers should look for ready-to-move-in projects. When builders are under duress, they are forced to provide discounts in order to increase volume, resulting in a buyers` market.

Purchasing a home for personal use makes sense, but purchasing a home for investment purposes does not. Given the large inventory levels and new goods coming in, prices may not rise quickly.

Conclusion: Final thoughts!

Despite the RBI`s decision to maintain the repo rate steady, homebuyers can still receive home loans for as little as 6.65% annual interest. The average home loan interest rate in January 2020 was 8%, which is a big difference. Buyers should act quickly to purchase a Residential Property in Thane because the scenario may alter if the banking system`s posture changes. SBI hiked home loan interest rates in April, despite the RBI`s decision to hold policy rates steady on April 7, 2021, signalling that banks may be moving away from the existing record low-interest rate regime.

The Residential price increase has slowed in the last year as a result of the effects on demand. Even though growing raw material costs are putting a strain on developers, they have refrained from raising pricing. Overall, the market is favourable for homeowners to realise their ambitions before the market returns to its previous interest rate regime and developers boost prices, which is projected to occur within the next 6-12 months.