Over 50% real es­tate buy­ing on­line

In­ter­net in­flu­ence es­ti­mated to be around 43$ bil­lion of real es­tate trans­ac­tion

HT Estates - - HTESTATES -

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.


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