• While owning a home is a aspiration for many, it is only a select few fortunate individuals who can turn this aspiration into a reality. Constructing your first residence is a significant endeavor and demands diligence, hard work, and a substantial financial commitment. If you are a first-time buyer, the pressure may feel overwhelming, but remember that grasping the various factors involved in purchasing a home can serve as a powerful motivator in bringing you closer to the goal of owning your dream home.

• Diligence and hard work are aspects you can easily contribute, however, having financial strength and stability is essential when it comes to budgeting for a home. You might rely on your savings for the down payment, but to handle the regular payments of your mortgage, you need to devise a plan for your monthly expenditures. A solid financial base will assist you in managing your finances. Regulating your spending, augmenting your savings, and avoiding debt are some fundamental principles to adhere to.

Understanding Homeownership Expenses Other Than the Mortgage

• Although acquiring a home can be a monumental life event, numerous costs arise beyond the mortgage itself. Some are unavoidable expenses, while others depend on your choices.

Let’s delve into them:

1. Registry and stamp duty:
   One of the clear and obligatory actions following the purchase of a home is registering it along with paying the stamp duty. The fees for stamp duty and the registration fee that is paid to the government to officially register the property can be rather substantial.
   For example, if a house costs around INR 3 crores, the registration and stamp duty fees will be approximately INR 18-20 lakhs.
   
2. Goods and Services Tax (GST):
   GST is the tax levied by the government on various goods and services available within the country. If the property is under construction, the GST applicable is 5%. Therefore, if you wish to avoid this cost, searching for a ready-to-move-in house may be advisable.
   
3. Maintenance Charges
   Upon reserving a house or flat, the builder may require a maintenance deposit. This expense is not included in the fundamental cost of your house. If amenities such as a clubhouse, gym, swimming pool, or park are offered, the costs could be doubled or tripled in comparison to a house with merely parking and lighting.
   
4. Parking Lot Charges
   In India, parking costs are not factored into the overall price of the house. These are charged separately. Depending on the type of community and parking provision, the fees may escalate.
   
5. Brokerage Fees
   Many individuals opt to engage a broker who can assist them in finding a home that fits their needs. A broker’s fee is typically contingent upon the price of the home acquired by the client.
   
6. Interior of your house
   The builder completes the basic interior of a house. However, you might not necessarily want to continue residing in the fundamental interior. From woodwork to kitchen modules and ceiling and floor installations, everything requires a significant financial investment.
   
   Quick Tips for First-Time Homebuyers
   
   First-time buyers experience a mix of enthusiasm and some uncertainty regarding the type of home they desire and the financial commitment they should make.Here are some quick tips to assist you:
   
7. Tip #1: Write down your requirements
   The first step is to identify your needs. You should converse with your family about your housing plans. It’s crucial to understand if you currently have the financial means to buy a home or if you could wait.
   
8. Tip #2: Choose the type of home:
   Houses can be either apartments or standalone homes. Each option comes with its unique advantages and disadvantages, and you need to consider which one aligns best with your preferences.
   
9. Tip #3: Select your amenities wisely
   The price of buying a home may increase based on the amenities provided. Therefore, before making a decision, ensure that the amenities offered by the builder are functional for you. Selecting features that you might never use could lead to unnecessary expenses.
   
10. Tip #4: Distance to your usual travel destination
    When considering purchasing a home, it is preferable to choose one that is close to your workplace or your children’s school. This approach can help you save on travel expenses as well.
    
11. Tip #5: Evaluate the surrounding neighborhood
    The location of the home is a significant aspect. Not only is the environment of the area important, but the location of your house also influences your home insurance costs. If your home is situated in a region vulnerable to natural disasters or threats, obtaining house insurance becomes crucial.
    
12. Tip #6: The builder’s reputation can provide security
    It is vital to assess the builder’s reputation before making a final decision. Ensure you are dealing with a reputable builder. They may charge slightly more, but you can have the confidence of securing your home.
    
13. Tip #7: Financing your home
    The last, yet most critical step, is to understand your financial limits. Obtaining a loan can be beneficial as it prevents depleting your savings. You can make a down payment based on your financial situation, and for the remaining amount, you may consider a home loan.
    
14. Tip #8: The 28% Rule
    The 28% rule pertains to 28% of an individual’s gross monthly income. It serves as a standard measure to determine how much of that income should be allocated to housing costs each month. Lenders utilize various factors, including credit score and income, to assess a loan application.