The following list identifies the most important factors to consider when selecting a home:-
Price. Stay within your budget. Avoid purchasing a home that you cannot afford. Although your favorite home may have ample space and a large yard, it may not be worth the stress of struggling to make the mortgage payments.
Convenient Location. Focus on homes in a convenient area so that you can minimize commuting time to work or travel time to other activities. You may save 10 or more hours of travel time a week.
Maintenance. Some homes built by well-known construction companies have lower repair bills than others. In addition, newer homes tend to need fewer repairs than older homes. A home with a large yard requires more maintenance. In apartments, residents share common areas, such as a swimming pool or tennis court. Normally, the residents pay a fixed monthly fee to cover the costs of maintaining the common areas. In addition, they may be assessed an extra fee to maintain the structure of the apartments, such as a new roof or other repairs.
School System. If you have children, the reputation of the school system is very important. Even if you do not have children, the resale value of your house benefits from a good school system.
Insurance. When you own a home, you need to purchase homeowner’s insurance, which covers the home in case of burglary or damage. The cost of insurance varies among homes. It is higher for more expensive homes and for homes in high-risk areas (such as flood zones) because it costs the insurer more to replace parts of the home that are damaged.
Taxes. Taxes are imposed on homes to pay for local services, such as the local school system and the local park system. Taxes vary substantially among locations. Annual property taxes are based on market value of the home.
Resale Value. The resale value of a home is highly dependent on its location. Most homes with similar features within a specific subdivision or neighborhood are in the same range. Although home prices in a given subdivision tend to move in the same direction, the price movements can vary substantially among homes. For example, homes in a subdivision that are within walking distance of a school may be worth more than comparable houses several miles from the school.
You cannot perfectly predict the future resale value of a home, but you can evaluate today’s resale value of similar homes in that location that were sold years ago. Information about home prices is provided on numerous Web sites. Be aware, however, that the rate of increase in home prices in previous years does not necessarily serve as a good predictor of the future. Keep in mind that when you use a real estate agent to sell a home (as most people do), you will pay the agent a commission that is usually about 2-3% of the selling price. Thus, if you resell your home for Rs 1 Cr, you will probably pay a commission of around Rs 2 lakhs and therefore receive Rs 98 lakhs. The buyer of a home may or may not pay the commission.
Personal Preferences. In addition to the general criteria described above, you will have your own personal preferences regarding features such as the number of bedrooms, size of the kitchen, and size of the yard.