With the outbreak of Coronavirus and the eventual passing of the pandemic, what are the odds of buying a house? While others may be scared off by the threat of Coronavirus, you can make the jump into homeownership. This resource tries to answer your question by examining the obstacles that first-time homebuyers face when it comes to buying, and what can be done to overcome them.
If you are considering buying your first home, 2022-23 will likely be the best year to buy. Here are four reasons why and tips to help you navigate the home-buying process.
The average house prices have certainly gone up in the last decade. This is to be expected as most countries are suffering from high unemployment and an overall bad economy due to the effect of the omicron virus & the Russia-Ukraine conflict. In the last decade, housing prices in the United States have increased by about 50%.
This is why most first-time homebuyers are having a hard time as they try to afford their first home. However, there is a silver lining to all this. The high real estate prices are actually good news for first-time homebuyers. When prices go up, they have to go back down and they always do. In fact, they have to go back down because the interest rates have to go back up. Since interest rates are in the basement right now, the only way they can go is up. So, when they go back up, prices will go down. Because the real estate industry has not been able to attain the anticipated sales numbers in recent years. Therefore, to clear the housing stocks the prices of lands have been decreased.
Best ROI opportunities for First time homebuyers
Housing prices have been on the rise for the past few years, making real estate one of the best investments in the market. But what makes real estate so lucrative in the first place? Well, for one, real estate allows you to build equity. If you have a home, then you have a roof over your head and that roof allows you to use the space above it. If you have the space above it, then you have the option of renting it out and that can bring you extra cash. The best way to get started with this is by buying a house that you can afford. The next step is to rent out the rooms and then you’ll be able to start building equity.
According to a study, the returns from the housing market have been going down from a high of 7.5% in the year 2010 to just 2.5% in the year 2017. This is expected to further decline to 1.5% by 2022. These figures are based on an example where the homebuyer bought a house of Rs.1 Crore and sold it after 10 years. The returns were calculated based on the appreciation of the house value and the capital gains tax. The growth in the value of the house was calculated at a rate of 3.5% per annum. This is the average rate of growth in the house prices of India. The capital gains tax was calculated at 40% of the gains.
Another reason why the returns from the housing market are going down is that the interest rates are also going down. The interest rates have already reached a historic low of 6.25%. The interest rates have been going down for the past 3 years and have hit the lowest levels. This has made the interest rates on home loans, car loans, and other loans fall as well. This is expected to continue for the next 4-5 years.
Government schemes First time homebuyers
First-time homebuyers can expect a lot of government support in the next five years. First-time homebuyers have already been enjoying a lot of government support, in the form of tax deductions, buying grants, and low mortgage rates. But the coming five years will be the best time for first-time homebuyers, thanks to the government’s new programs.
Buying a home for the first time can be exciting and scary at the same time. There is a lot to consider and it can be hard to know where to start. We hope you found this blog helpful, and wish you all the best in your home buying journey! To learn more, please contact us anytime at openplot.com.