A Handy Guide for all Women Home Buyers in India

Real estate has always been perceived as a male dominated sector. But today’s women are moving at par with men and earning equally well, thus leading to a change in this traditional mindset. They are actively participating in home buying decisions. It has been estimated that 30% of the buyers are women in urban India. Interestingly, women home buyers can enjoy a host of benefits if they plan to invest in Indian real estate.

Tax Benefits

The maximum tax deduction allowed in the principal and interest repayments is Rs 1.5 lakh and Rs. 2 lakh, respectively. Women borrowers applying for a home loan along with their husbands can receive tax deduction in an equal proportion. In case the property is self-occupied by the woman, additional deduction on the interest of up to Rs. 2 lakh can be claimed by her every financial year. If a husband and a wife are the joint owners, and if the wife has a separate source of income, then they can both claim tax deductions individually.

Home Loan Interest Rates

A comparative analysis of bank lending rates suggests that women usually get lower rates while applying for a mortgage. In comparison, men are offered 0.05% higher rate. This is however subject to change as per the monetary policies and market fluctuations.

An important note to consider is that the lending banks or HFCs offer discounted rates only if the woman is the solo or first co-applicant.

Reduction in Stamp Duty

A difference of a few percentages in stamp duty can make a huge difference in your home ownership cost. The lenders finance a home loan at about 80%-90% of the property cost. As far as stamp duty goes, it differs from one state to another. A concession of 1%-2% is generally applicable to women home buyers even if it gifted to them, as long as the property is in the lady’s name.

A checklist before buying property

• Plan your finances

 The first thing to consider while taking a home loan is affordability. Ideally, your home loan EMI should not exceed more than 35%-40% of your net salary.

• Scrutinize the lender

For the first level of research, go online and compare all the loan products that suit your needs. Once you have shortlisted that, visit the bank branch to understand the features of the loan product you’re interested in.

• Choose a credible builder

Once again, your first level of research should be done online as that will give you a fair idea of what to expect. Then contact real home owners and check out the pros and cons of the property you are interested in.

• Invest in developing pockets

 In the recent past, growth of the real estate market in both Bangalore and Chennai has been exponential. This is largely because they are among the most prominent cities in South India in terms of generating new businesses.

The IT revolution has led to the development of a lot of residential projects in Bengaluru. Women come here from different parts of the country to work and settle down, as it is a safe city with better connectivity and infrastructure.

With improved public transport, better law enforcement and the recent addition of the Metro Rail, more women are buying flats in Chennai due to its enhanced quality of living.

With growing financial independence, friendly financial and taxation initiatives from governments and lenders, and a strong desire to own their own home, it’s hardly any surprise that more women are becoming first-time homebuyers.

Article by House of Hiranandani