Renting vs Buying in Bangalore: Making the Right Choice
Over the past decade, Bangalore has surged as one of India’s top IT hubs, earning the moniker “India’s Silicon Valley.” This boom has drawn professionals from across the country due to its tech parks, startups, R&D centers, and corporate offices.
This growth has significantly impacted Bangalore’s real estate sector. Reports indicate that in 2022, the city saw record supply and absorption of residential properties. Both budget and luxury housing are in demand. As relocation to Bangalore rises, choosing between renting and buying property becomes crucial.
Understanding the nuances of this decision is vital for individuals and families moving to Bangalore. This article offers a detailed comparative analysis of key factors to consider when deciding between renting and buying.
Factors Favoring the Rental Route
Lower Upfront Costs
Compared to buying, renting a property in Bangalore is easier on the pockets, at least initially. It saves buyers from immediate outlays like down payments, registration charges and stamp duties – which could amount to 30-40% of the property’s value. Instead, small investments like paying the brokerage fee, security deposit and first month’s rent can secure a rental.
Greater Relocation Flexibility
Considering Bangalore’s work culture involves frequent job changes, the flexibility to relocate is a massive plus for renters. Short-term leases allow changing houses with a simple notice period and avoiding long-term commitments. On the other hand, owners must deal with exorbitant realtor fees, ownership transfer paperwork, and taxes when selling property to move neighbourhoods.
Lifestyle Focused Living
The abundance of plush and modern rental apartments across Bangalore guarantees a comfortable living experience without ownership burdens. With facilities like gyms, pools, clubhouses and in-house maintenance staff, tenants can unwind after a hard day’s work. Many societies also have restaurants, sports zones and convenience stores.
Factors Tilting Towards Buying
Asset Ownership & Building Home Equity
The foremost incentive of home ownership is gaining a valuable asset – which tends to appreciate substantially in cities like Bangalore. Per market projections, property prices are slated to rise 10-15% yearly across prime Bangalore localities. Though buying costs are steep during property acquisition, owners can sell at handsome profits later.
Additionally, every mortgage EMI payment builds a portion of home equity. In the long run, buyers recover the money sunk into the property rather than draining savings on rent. Tax rebates on home loans are a bonus.
Personalisation & Customisation
Owners have full authority over property modifications, renovations and maintenance work. Customizations like kitchen customization, additional electrical points, plumbing overhauls or interior design upgrades can be accommodated based on needs and budget. Renters must rely on the landlord’s discretion to approve any add-ons or alterations.
Stability & Continuous Occupancy
Homeowners need not worry about short-term occupancy terms or rental lease renewals after expiry. There lies guaranteed housing stability for self-occupation, and family stays over long periods without fluctuating rental rates or eviction notices. Owners can even lease out spare rooms or apartments for supplementary rental income.
Home Loan Eligibility the Key Decision Driver
Analyzing Parameters Like Income Levels, Credit Scores & Debt Obligations
Beyond weighing the rent vs buy factors as per needs, the pivotal deal maker for buying property is securing home loan approval from banks and financial institutions. With public sector banks offering housing loans as low as 6.5%, financing has become vital to turning buyers towards ownership.
But getting home loans sanctioned, especially with higher eligibility, remains tricky due to stringent gender norms. Parameters like income levels, employer profiles, credit scores, existing EMIs and debt-income ratios are analyzed in detail before sanctioning loans. Self-employed applicants need to furnish additional income proofs.
Therefore, potential buyers must evaluate their loan eligibility through online EMI calculators or consulting banking advisors. This clarifies the property values one can realistically purchase via financing support. Individuals lacking loan eligibility may be better off living on rent until they save enough corpus funds to afford large down payments for home buying.
In conclusion
Renting vs buying dilemmas need customized solutions based on financial status, employment stability in Bangalore, family plans and ownership responsibilities that can be managed. Newcomers settling into their first jobs are better off testing Bangalore’s residential pockets through renting before finalizing localities to purchase apartments.
As careers stabilize over the years, upgrading to bigger family homes on an ownership basis makes sense. Irrespective of whether you currently rent or own, there will always be an option to switch sides as needs and priorities evolve!
