Home is where the heart is. That’s why buying a home is a milestone in many of our lives. Most of us achieve this when we hit the 30s – that ideal time when a career is taking shape and you might have a partner to share the home with. There are very few who would think of owning a home in their 20s as it’s either beyond their reach or, it’s simply too challenging a process to be involved in.
Yet, the younger you are the more financial sense it makes to own a property. It gives a definition to your life, helps set financial goals, and provides opportunities for further investments.
Here are a few tips from our experts to help you get an early start on real estate investments and own a home in your 20s.
Do the research
The first step before any decision-making is to educate yourself on what you are getting yourself into. Understand the pulse of the real estate market by reading the latest reports and property news. Garner knowledge about taxes, legalities, government policies, and the process of obtaining loans.
Talk to experienced investors who can offer invaluable suggestions and tips from their own experiences. Zero in on your priorities and make a list of the neighbourhoods that you would like to live in. These few essential steps will enable you to get a firm foothold in the property landscape, which will help you make well-informed decisions.
Prepare for the purchase
One of the most challenging steps in your home buying journey would be building up credit. Enough to convince banks to give you a loan. Having zero credit is not an advantage here. Get a credit card to remedy this and slowly build up your score. If you already have a credit history, make sure you review your reports to see if you meet the requirements that banks have set.
Once you have decided to buy a house, you will need to save, aggressively, for the next few months or a year to shore up the necessary finances. Remember, expenses don’t stop with the loan. There’s furnishing, paint jobs, and other issues that are bound to come up down the road.
Taking a loan
The most daunting aspect in the journey of a home buyer is the loan. But don’t be put off by the prospect of managing it single-handedly. If you don’t have a spouse consider bringing in a partner like a sibling or family member to share the finances with. But make sure that your partner has a good credit score and a good job to avoid issues cropping up in the future.
Keeping risk low
Dreaming of owning a sprawling villa where you can hold house parties late into the night? As tempting as it is, the villa comes at an exorbitant price tag, which might prove to be a financial hassle a couple of years down the line.
Hone in on relatively affordable properties that will not hamper your lifestyle too much with hefty EMIs, and will leave you room to make other investments like life insurance that ensure a stable financial future.
Location is key
When you buy a house, the instinctive impulse is to look for houses near your workplace. But work patterns have shifted now with employees having more flexibility to manage their work hours from home or elsewhere.
Keep this point in mind when hunting for your home and target neighbourhoods that show good potential for price rises in the next few years. Sure, many of these promising areas might be away from the city, but if they are close to public transport in the works, then it would be highly beneficial in the long-run as connectivity improves gradually.
Social infrastructure and lifestyle
Opting for areas with high investment potential should not take away the need for good social infrastructure and amenities that can support your current lifestyle.
Having medical care at hand, shopping and grocery outlets, and options like entertainment like takeaways and cinema theatres are important.
