Over 50% real estate buying online
Internet influence estimated to be around 43$ billion of real estate transaction
ffset balance home loan is an arrangement that some banks offer to customers who do not have the funds or saving ability to prepay their loans. In this arrangement, the client needs to deposit whatever extra income is available into a current account, which is then offset against the outstanding amount on the home loan.
T h e b o r r owe r ’ s s a l a r y account can also be linked for this purpose so that he or she will have to make only judicious withdrawals ( from the account) going forward to ensure a surplus balance. Banks will usually encourage customers who are contemplating this route to use the salary account option.
In many cases, offset interest home loans can be more advantageous than prepaying the loan. With this product, the customer can potentially reduce the tenure or the loan and also save on interest. In the case of prepayment, banks usually require a minimum amount to be paid, but this is not required with an offset balance home l oan, says Kishor Pate, CMD
– Amit Enterprises Housing Ltd.
The bank calculates the interest on the basis of daily reducing balance.
The downside of the offset balance home loan is that the charge- able interest is higher than for a conventional home loan – usually by 25-50 basis points. Also, if the loan is linked to a salary account of someone without the ability to save prudently, the arrangement can backfire.
Offset interest home loans may be suitable for individuals who are not in the habit of saving regularly or prudently. This makes prepayment of a home loan in part or eventually in whole impossible for them, so such a product would probably be their only viable recourse.
However, it is actually wiser to invest one’s surplus funds diligently in some other instrument such as mutual funds. The proceeds of such an investment on maturity can be used to prepay the home loan at a predictable time.
Can you afford it, are you getting what you paid for according to the prevailing property market rates, and have you factored in all the hidden and future costs?
Is the home large enough for you now as well as for your future needs?
Is it safe for you, does it have the right conveniences within reach and can you travel to and from your place of work from there every day?
Will it appreciate sufficiently so that you can sell it at some point and move to another place?
Over 50% of real estate buyers’ decisions are influenced by internet research. The phenomenon of researching online for real estate information is not limited to metros but also extended to buyers in tier two cities, says a study.
The study by Google India to understand the influence of the internet on real estate purchase decisions in India said that the overall influence of internet today on real estate transaction value of both residential and commercial property including rentals amounted to US$43 billion with US$31 billion for residential and US$12 billion for commercial properties.
The offline survey conducted across 15 cities in India with over 6,000 respondents revealed that 74% of real estate research online was focused on residential buying and 26% focused on residential renting. Almost half the respondents were indifferent to new or resale property (47%) as the criteria for research focused more on their space requirement, budget and location. In the survey, respondents rated internet in the top three medium for information for real estate research, with 24% respondents rating internet as the top destination for information. Print media and salesbroker offices were the rated as the other top two sources for property information.
Amongst the top destinations on the internet for real estate information, aggregator sites ( 62%) were rated as the top source for information, fol- lowed by builder and developers sites (52%). Online broker sites and real estate blogs and forums (45%) were also found to be popular. In tier 1 cities over 57% buyers were influenced by online research and, in tier two cities, the impact was equally high with 48% buyers saying that they used internet to research for real estate purchase decisions. The usage of mobile phones for accessing information online was also significant with over 55% buyers using it.