HOMING IN

Low prices, cheap interest, plentiful supply: this may finally be your chance to buy a home. But its foundation must be on wise, careful choices

- Vishav

It’s as easy to ask the question as it is for a child to sketch a dream house in her sketchbook, with clouds and a tree next to it. Is this a good time for you to buy your own dream house? The question has been with you for a while. Let’s say you had recently, maybe a year or two ago, at last, reached a point in your life when you could finally afford one—that is, foresee being able to pay out a loan in a stable, predictable manner. Or you are at another phase in life and looking to add some more concrete to your long-term investments. In either case, you were biding your time. So should you go for it? It’s an instinctual question in times such as these: the economy is in a trough, and prices are low. Common sense should tell you this is a buyer’s market. But the fine print of life can always hold surprises, so let’s carefully examine the pros and cons.

First, the reasons to answer with a yes. Housing prices have indeed been on a downward swing, and that trend was on even before the pandemic struck. Data from the Reserve Bank of India (RBI) tells us home prices had declined around 1 per cent during January-March, compared to the previous quarter. Post-COvID, there was a drastic dip, and then a correction that still left prices significantly lower. And reports predict a further fall, though the jury is out on that. Plus, there exist two related facts of direct relevance: one, interest rates too have come down and efforts are being made by RBI to ensure the benefits of rate cuts are passed on to homebuyers; and two, there’s no dearth of unsold inventory. So there’s both choice and capacity for end-users and investors. That should make it a buyer’s market with a good possibility for better price negotiation?