Later, not sooner, to buy your dream home

Waiting for the festive period, when investor sentiment is high, is a wise move when looking for a home loan product. 

Every person wishes to buy a house for themselves and their loved ones. However, expensive real estate in India makes this dream an impossibility for most people. But those who properly plan the purchase account for the right timing.

The ‘right timing’ denotes a confluence of one’s personal finances, reduced interest rates and the best property that is available for purchase at that point of time. However, while one may or may not have adequate money at their disposal, or even find their dream house at the time, getting the right home loan is a matter of research. Most buyers wait patiently for the festive season to come around, when they believe that it is auspicious to buy a house – and when home loan rates are lower. 

Why wait for the festive period?

The festive period (generally spanning Ganesh Chaturthi, Navratri, Diwali, and later Christmas and the New Year) comprises of many days and dates that Indians consider auspicious for new beginnings. Thus, weddings, christenings, house and car purchases etc. are all timed to coincide with these dates.

Housing finance companies and banks are well aware of the positive sentiment towards big ticket purchases during this time. Thus, they maximise this sentiment by offering limited period home loan offers. Chief among these are lower interest rates (applicable for the tenure of the loan) and zero processing fees. 

Other home loan offers include discounts on online application of home loans, or transfer of existing home loan to another lender at a reduced rate, etc. 

Reduced interest rates are the biggest magnet during the home purchase process: a lower interest rate translates into a lower EMI, and hence, lesser repayment to the lending institution. A good offer also includes no processing or legal evaluation fees when granting the loan – this is a significant saving for the buyer. 

Not just banks and lending institutions, but real estate developers may also have offers to attract buyers. However, these are not always timed to coincide with the festive period, and may include such incentives as paying only 5% of the project cost to book the house, and paying the balance 95% on flat possession. Or they may include many free amenities or discounts for booking within a limited period of time. Many have pre-approved home loans on the project, so this also saves a lot of time for the buyer. 

However, do resist the temptation to buy a property only because there is a home loan offer being pitched at the moment. Do take some time to find the right home, and book it so that the developer or home owner does not sell it to someone else. You can then apply for the home loan at a suitable time, when a good offer comes along.