Buying a home for many of us is a dream come true. It is as important as getting that first job or choosing a life partner. That is why it is crucial for us to understand all the procedures or the ‘behind-the-scenes’ of buying a home. For many reasons, buying a home is a tedious and time-consuming process. That is why we have come up with the list of 15 things every new home buyer should be aware of before buying a home.

1 -  Understand your need or know what you want: 
This might be quite obvious, but we are stating this because it is the most important point. Knowing what you need, better yet, writing it down somewhere will not only enable you to focus on the right house to buy or build but also  this will make sure you do not drift astray from the budget or other important things. 

Also, knowing what you need can enable you to focus on what type of home to look at, where to look at and how to proceed. Having your need sorted out will also help you through the points that follow in this list. 

2- Know the location: 

As a new home buyer, you might have already shortlisted a location that you would like to settle.  Location is crucial because everything else starting from amenities to travel availabilities all depend on the location. The last thing you want is to settle at a place that is far away from your work or a something that does not have a hospital or a school. Thus, when you choose a location make sure it suits your needs well and that it has all the basic amenities available. 

Wondering how to choose that right location? Click here

7 reasons why you should buy a home at Tripunithura

3- Know your budget or Know what you can afford: 

Having a budget is the most important thing while looking to buy a new home. The right budget can provide you with the right financial freedom and also will enable you to buy your dream home. 

 The key to land at the right budget is to organize your finance and exercise discipline. It doesn't have to be a complicated though. Here is how you can achieve discipline according to Union Plus (cite source 2) 

-  Note down all your sources of income 

- Make a list of all monthly expenses

- Divide this expenses into three

        - Fixed: Those that you are sure you have to spend 

         - Flexible: Those that may arise in a month. This includes the fund for emergencies 

       -    Discretionary: These are the expenses that you can choose to avoid such as movies, clothes, eating out, party etc

- Consider the difference between your expenses and income: If expenses are more than income then you will have to immediately bring all things under control 

- review the flexible and discretionary expenses to look at where you can cut down on expense 

- Come up with a budget that will be financially comfortable for you. 

- Review the budget consistently 

According to Twocents (cite source 1), it is better that you do not stay at the brim of your budget. It is ideal to set aside a budget that is well under what you can afford so that you can give room for any contingencies that may arise. 

4 Consider additional expenses: 
Buying a home is a complicated process. We agree to that. That is why there might be expenses that you cannot foresee while buying a home. This is especially true when you are considering to build a home by yourself or by a builder. Many things from landscaping to interior works can accrue these kinds of expenses and that is why it is ideal to consider any additional expense that may come along. Here also, you can set a contingency budget that can be used to hedge this.  

 5 - To build or to buy: 
Now, this is one question that will bother all of us. You might already have a property lying dormant and that will make you want to build a home rather than buying one that is already built. Or you do not really want to spend all the energy and time on the tedious process of getting a home built and want to buy one that is already built by some quality builder. It all boils down to what you really want. 

 Following are the options that you may consider 

1) Build a home by yourself:

This option is best when you already have a plot at your disposal or have enough money to buy one, where you want to build a house. This option will cost you time and effort. You can locally source for workers and other skilled labourers who will work for daily wages and help you build the home you are looking for. This plan, however, will mean you will have to do it all by yourself, starting from looking for an architect to plan your house, to finding the right people to do the interiors. 

While all this may feel hefty work, the upside is that you can control the outcome and the expenses. You will have complete freedom on what material to use and also how every part of your house will look like. Also, this might be one of the most budget-friendly option since you are the one controlling and taking care of all expenses.

2) Get a home built by a contractor or an engineer: 

This is a relatively easy option. Here you look for a skilled and reputed contractor or an engineer who can help you get your home build. The contractor can help you from all legal paper works and permits to finishing off your interiors. This type of option is highly flexible because you can customize or let the contractor know exactly what you like and get it built the way you want. 

However, the key thing is to have trust in the contractor and there should be maximum transparency in all the dealings. For more on how to choose a contractor and how to deal with them, check this page 

Also, this option might cost you more than the above since there will be a charge or there will most definitely be a profit margin involved for the contractor.

3) Buy from a reputed builder: 

The third and one of the most widely used option is to rely on a very reputed builder (link to our blog about how to choose reputed builders)in your area. The advantage about doing this is that you do not have to worry about any of the hassles involved. The purchase process of most builders is frictionless, thus ensuring you have a very stress free purchase experience. The economies of scale allow builders to construct apartments or houses at a very reasonable cost while not compromising on the quality. That is why you should choose only a reputed and trusted builder. For many, this might be the best option out there, especially considering the cost of real estate.  

For more details, you can read our article on how to choose the right builder for your house here.  

 6) Availability of finance: 

To build a home it is not necessary to have the full cash at your disposal. For most of us, it might not be possible to roll out that much money. There are many varieties of home finance options available for a home buyer. If you have a set budget in mind it becomes easy for you to look for finance option. All major finance institutions offer these type of finances that you can choose for a tenure that suits your budget and tolerance. 

 One other advantage of taking finance option is that it can give you tax benefits. It can provide you benefits depending on the amount of EMI you will be paying per month. 

 According to Bank bazar (source 3), the following are some of the options of finance available right now in the market. 

1) Loans to purchase land

2) Loans to purchase an already built home 

3) Loans for the construction of a house

4) House expansion or extension loans to expand your current home.

5) Home conversion loans where you can covert your existing loans to a new one if you are planning to move to a new house

6) Home improvement loans for repairing or altering your house

7) Bank transfer loans that can be availed when you want to transfer your loan from one bank to another

8) NRI Home loans specially designed for Non-Resident Indians

9) Bridged loans that can be used to fund short-term land related financial needs

10) Stamp duty loans can be used to cover the expenses of stamp duty 

7) To approach a real estate broker or not: 

One question that always bothers a new home buyer is whether or not to approach a real estate broker. A real estate broker can help you find your home at a very fast pace and also can help you with the paper works. They will also have a database on many of the properties or homes that are on sale in a certain area and can also help you negotiate a proper price. However, real estate agents cost money and you might have to spare some commission to get the task done. 

8) Documentation process: 

A new home buyer should have a thorough grasp of all the documents necessary. From the statutory permits required to the documents required for registration at local authorities, a new home buyer should be aware of all documents that are required. Even if you are seeking the help of a contractor or a professional builder you should know what documents will be needed and how to get them. For more details about the type of documents and how to obtain them, read our detailed article on them here (link) 

9) Importance of inspection: 

If you are all set to buy that home from a good and reputed builder in your area, make sure you inspect all aspects of the building thoroughly. Be it the building material being used or the wiring and plumbing material, you have to make sure you thoroughly inspect them. 

 This applies specifically if you are looking to buy a home that is already constructed. Because here you cannot know what kind of material or wiring they have used. What you can do is to ask the home builder for maximum details and make sure you account them properly. You can also inspect various aspects of the home to get an idea on whether to go forward with the purchase or not. It is important to look for quality in all aspects of the home because buying a home is a very important and cautious decision one should make. 

If there is one advise we can give you, it is to never take inspection for granted. 

10) Think long-term :

A house is a decision that will impact your life for a long time, not just financially. This counts especially if you are young. The advantage of thinking long term is that you can also understand the future costs that may incur while you are living in the house.  Many of us think that buying a house is the only expense that we will have to bear. But the reality is that living in a house can cause significant other costs including maintenance of the house. So it is always ideal to think long-term expenses and not just the cost that you will incur now. We advise you consider this also in your budget. 

 So go ahead, think about how your future is going to be, what other costs may come and buy a house accordingly. 

11) Understand the terminologies: 

When you first enter the real estate market, do not be surprised about many of the terminologies that you might have a hard time understanding. That is why you have to do your research on all the terminologies yourself and learn more about them. You can check out Reuben Estate Consultant’s full list of glossary here (source 4) 

12) Know all the property rules 

Rules relating to properties change at times. You have to make sure you keep tabs on all the rules that are coming into action at the time. For example, the central government have recently passed the RERA. The Real Estate (Regulation and Development) Act, 2016 (RERA) is an Act passed by the Indian Parliament. The RERA seeks to protect the interests of home buyers and also boost investments in the real estate sector. While these kinds of rules may not directly affect you but it can influence the industry. It will also help you understand the benefits you can get as a home buyer. 

13) Scalability: 

According to Commonfloor (source 6), one important thing you should consider while buying a home is the fact that your family is going to become big and that this happens steadily. So you should consider the scalability of the house you are buying so that it can accommodate more people. 

14) Understand common area: 

If you have decided to buy an apartment, this point will most definitely come in handy. One key term and point you should understand is the ‘common area’. The term "common area" is used to refer to a space on a piece of property which is owned by all owners on the property on a percentage basis, or to spaces owned by an overall management structure which charges each tenant for maintenance and upkeep. The  Economic Times (source 7)defines common area maintenance as  The contribution or fee paid collectively by the owners of individual units for the maintenance and upkeep of the non-exclusive areas of the premises is called common area maintenance.

It is important for you to understand this especially if you are looking to buy a property at an apartment building or a villa with common grounds and facilities. 

15) Never compromise on quality:

This point is put last because this was the point that we wanted to highlight and stress this point. No matter what, even if the reason is financial, never compromise on quality. This is important not just because there is a significant amount of money involved but buying a house and living in it is a process that involves dedication and trusting on many factors including other people so one thing that you can blindly count on to ensure a longer life and better return on your investment of money, time and effort is a house built with top quality materials, top quality construction procedure and a top quality process.
 

Learn more about Lotus Properties quality policy here. 
 

Conclusion: 

 Buying a home for many of us is a dream come true. That is also why it is a step that you should only take carefully. We believe the above steps will guide you in the buying process. 

 Download our ultimate checklist for a home buyer here: