Owning one dream house is a common dream among one and all.
We must, however, appreciate that during our lifetime our lives undergo a dramatic change, typically on at least three occasions. As such, it often makes sense to realign our environment from time to time, to suitably cater to these new realities.
Within this environment, our house is an extremely important component. As such, we must reassess our aspiration to own one exquisite house property.
Instead, in my opinion, we must have a plan to buy three.
First house
Rent is an expense, whereas EMI is an investment. So buy your first house in the early years of your career. Don't continue too long with a leased premises and paying monthly rent for it.
Squirrel away small amounts right from your first pay cheque. In a few years, you would have built a decent amount of corpus.
This should be good enough as a down-payment to invest in a small but cosy and comfortable dwelling; preferably near your / your spouse's work place. Remember you are not buying something where you will stay for the entire lifetime. It is for you and your spouse to spend say around 5-7 years, till you have kids.
Smaller house also means lower EMI burden.
Second house
Once you have kids, you naturally need a bigger apartment. Also, you may have to accommodate your elderly parents who would have retired by now.
In addition, your location preferences may change as you now need something closer to school and hospital.
This is when your second dream home takes shape.
And your decision to buy a "small" property early on, now bears fruit.
Due to price appreciation, it would fetch you a nice sum. This not only becomes your down-payment, but also reduces your dependence on home loan. Lesser loan amount directly translates into lower EMIs. This is extremely important given the increase in your monthly expenses, primarily on account of children's education and parents' medical issues.
Third house
It is now the beginning of twilight years and your nest is empty. While the parents would have left for their heavenly abode, your kids would now be adults... beginning their own independent lives and probably working in different cities.
Time to make your third switch... back again to a smaller house.
As you grow old, managing and maintaining a big house would be difficult and expensive. Also, you now need to be close to your support system such as your friends and relatives.
Moreover, moving to a smaller house would free up precious resources that would supplement the retirement corpus you may have separately accumulated and help you to lead a financially comfortable life.
Besides, with the 2nd home already 20-25 years old, it won't be a good idea to continue staying there for another 20-30 years.
In short, don't be fixated or attached to just one dream home.
Rather, think of three:
Functional and practical homes offer lot more than a grandiose apartment, which may be good just for the snob value.
Think different. Act different. Be different.
We must, however, appreciate that during our lifetime our lives undergo a dramatic change, typically on at least three occasions. As such, it often makes sense to realign our environment from time to time, to suitably cater to these new realities.
Within this environment, our house is an extremely important component. As such, we must reassess our aspiration to own one exquisite house property.
Instead, in my opinion, we must have a plan to buy three.
First house
Rent is an expense, whereas EMI is an investment. So buy your first house in the early years of your career. Don't continue too long with a leased premises and paying monthly rent for it.
Squirrel away small amounts right from your first pay cheque. In a few years, you would have built a decent amount of corpus.
This should be good enough as a down-payment to invest in a small but cosy and comfortable dwelling; preferably near your / your spouse's work place. Remember you are not buying something where you will stay for the entire lifetime. It is for you and your spouse to spend say around 5-7 years, till you have kids.
Smaller house also means lower EMI burden.
Second house
Once you have kids, you naturally need a bigger apartment. Also, you may have to accommodate your elderly parents who would have retired by now.
In addition, your location preferences may change as you now need something closer to school and hospital.
This is when your second dream home takes shape.
And your decision to buy a "small" property early on, now bears fruit.
Due to price appreciation, it would fetch you a nice sum. This not only becomes your down-payment, but also reduces your dependence on home loan. Lesser loan amount directly translates into lower EMIs. This is extremely important given the increase in your monthly expenses, primarily on account of children's education and parents' medical issues.
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| Discover why, instead of just one, you have to think of three dream houses. |
Third house
It is now the beginning of twilight years and your nest is empty. While the parents would have left for their heavenly abode, your kids would now be adults... beginning their own independent lives and probably working in different cities.
Time to make your third switch... back again to a smaller house.
As you grow old, managing and maintaining a big house would be difficult and expensive. Also, you now need to be close to your support system such as your friends and relatives.
Moreover, moving to a smaller house would free up precious resources that would supplement the retirement corpus you may have separately accumulated and help you to lead a financially comfortable life.
Besides, with the 2nd home already 20-25 years old, it won't be a good idea to continue staying there for another 20-30 years.
In short, don't be fixated or attached to just one dream home.
Rather, think of three:
Functional and practical homes offer lot more than a grandiose apartment, which may be good just for the snob value.
Think different. Act different. Be different.
