Several experts have opined that renting may sometimes be a more viable choice as compared to home loans and EMI repayments. Renting for a lifetime is becoming more acceptable for an entire millennial generation which is always moving, be it for professional pursuits, change of scenery and also for leisure. Several millennials are considering rentals like take-aways or demand-based consumables. Renting means paying someone else in some cases to do everything including maintenance, utility bills, cooking food and so on. It also indicates sometimes being able to live in a better locality than one could otherwise buy a home in.
There are individuals and families who are more inclined towards investing in stocks/mutual funds instead of real estate. Millennials are now looking at creating wealth without setting down roots in many cases. A family should always have a fixed portion of their monthly income for paying rentals and account for an increase of up to 10% annually. 35-40% of total monthly income can be put aside for paying rent.
Many younger couples often start living on rent and then purchase a starter home in a peripheral zone with a smaller loan outgo. They earn rent from the flat in order to cover some of the rent that they’re paying. Mobility levels are extremely high upon renting in cases where the family size goes up or one does not like the residential society or aspects like shortage of water, maintenance hassles or leaks.
On the flip side, however, there is a huge psychological aspect towards homeownership which rental units will never quite cater to. Renting is also an expenditure from the financial point which does not have any long-term advantages. It does not help in building an asset unlike paying home loan EMIs which go towards building a major asset for the future. There are tax benefits to be had with homeownership as well.
According to the Founder & COO at SquareYards, Kanika Gupta Shori, after some years, the sheer expense of renting may be burdensome along with the restrictions on renovating/refurbishing living spaces right from painting and installation of fixtures to putting up the artwork. There is also huge stress involved in shifting homes periodically according to her.
Square Yards is a technology-enabled, global real estate aggregator and India’s largest player for primary residential real estate. It’s subsidiary Square Capital is one of the largest marketplace for secured mortgages in India. Square Yards platform offers an integrated consumer experience & covers the full real-estate journey from search, discovery to research, transactions, home loans and post-sales service – fully integrating buyers to an extensive network of 500+ partner real estate developers, and 90+ banks & NBFCs. Square Yards is led by accomplished professionals, ex-bankers, and Ivy school alumni and is backed by the competence of more than 2500 employees in 30 cities and ten countries.