How Much You Can Invest to Buy Your Dream Home?

As money is an important factor when you think about to buy your dream home. Everybody thinks to buy a cosy and luxury villa with a garden, green or eco-friendly environment, peaceful place apart from the city noise and all the modern ammonites to give your family a luxurious life style.

Everyone’s idea of a dream home may be different, but since money is an object for most, these aspirations should be toned down accordingly. However, most homebuyers end up stretching their finances when they take the plunge to turn their dream into a reality. In trying to buy that perfect home, you might end up denting your finances beyond repair. Further, the costs involved go far beyond the sticker price of the house, and if you don’t factor in the additional expenses, you might be in for an unpleasant surprise. Read on to find out how to prevent the roof over your head from becoming a burden on your finances.

Buying the dream home can be a very expensive affair, yet homebuyers are not averse to stretching their savings to the limit to make it happen. Since banks do not lend more than 80-85% of the value of the property, at the outset, the buyer has to shell out a lump sum as down payment of the house. Most end up taking a large chunk out of their life savings to make this payment and secure the home loan.

At the outset, get rid of any illusions you have about being able to sell the property whenever you need to and get full value for the asset. Real estate is not high on liquidity, and the current market is enough proof of how difficult it is for sellers to find a buyer at a desirable price.

Further, banking on a rise in the value of the property in the future may come back to haunt you. It would be unwise to commit to a high-ticket home loan based on this expectation. The current real estate market is not ideal for investment, as prices are elevated in various pockets and rental yields are hardly attractive.

For most middle-class families, even if they manage to overcome all other difficulties, buying a home involves some form of compromise. Most stretch their budget to buy a bigger home than they can actually afford, in a location that convey a superior sense of social ‘arrival’ but doesn’t necessarily offer a better lifestyle.

Yet, perhaps the biggest price homebuyers pay for their soaring aspirations is the impact it has on their other critical financial goals. A bigger home will likely eat into your household income and savings significantly, forcing you to up compromise on other aspects of your family’s life.

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As money is an important factor when you think about to buy your dream home. Everybody thinks to buy a cosy and luxury villa with a garden, green or eco-friendly environment, peaceful place apart from the city noise and all the modern ammonites to give your family a luxurious life style.

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