Purchasing a home is a dream for many people across the country. With the help of home loans, many people have successfully realized their dream of buying their own house. Moreover, owning a home comes with several advantages and therefore, it is always better to choose homeownership over renting.
Below are some of the major advantages of homeownership:
It’s a good investment
Property’s price increase significantly within a short span of time. Therefore, if you stay in your home for a long duration, it could increase the value of the property and provide you a substantial return on your investment.
It can help you build equity
Owning a house can prove to be a great way of building equity. Homeownership can help you build equity in the following ways:
- With each monthly mortgage repayment, a portion goes toward reducing the amount you owe on your home loan. This, in turn, increases your equity.
- Additionally, as the value of your home increases, it creates more equity for you.
Since homeownership can help you build your equity, it also gives you the option of availing a loan against your home equity whenever necessary. The amount availed through a loan against home equity can be utilized for several purposes such as financing your child’s education, managing urgent medical expenses, paying off debts, etc.
You can enjoy tax rebates
Homeownership can also help you enjoy several tax benefits. In case you avail a home loan for purchasing your home, then you are eligible for following tax discounts:
- Under Section 80C of the Income Tax Act, you can claim a maximum home loan tax deduction of up to Rs. 1.5 Lakh from on the principal repayment.
- Under section 24 of the Income Tax Act, you can claim a maximum tax deduction of up to Rs. 2 Lakh on the interest amount payable.
- However, it is to be noted that these deductions are applicable only on the property whose construction is completed.
It helps you build a strong credit history
- If you avail a home loan to purchase your home and make timely repayment of the loan amount, it can help you improve your credit history.
- This strong credit history can prove to be extremely helpful in the future when you need other loans. Lenders will consider you as a low-risk borrower and approve your loan application quickly. Moreover, strong credit history can also help you avail loans at a reduce interest rate.
You can design your home according to your wish
Unlike residing in a rented apartment, homeownership also provides you tremendous freedom to design and renovate your home according to your wish. You can paint the room, make changes to floors and do all the changes you like, without having to get approval from a landlord.
Now that you are well aware of various homeownership advantages, make sure that you purchase your own home rather than living in a rented apartment. With leading financial institutions, you can avail a home loan is a hassle-free manner. Make sure to calculate your monthly EMI beforehand with the help of an online home loan EMI calculator. This will help you plan your monthly budget wisely.