Unlock the Benefits of Property Buying: Why It’s More Than Just Owning a Home
Real estate isn’t just about owning a home—it’s about unlocking opportunities, building wealth, and shaping a secure future. India’s top cities are witnessing a property boom, with residential prices surging across high-demand areas.
For instance, Bengaluru saw a remarkable 90% price hike from 2019 to 2024, driven by demand for premium housing, while Hyderabad’s Kokapet rose by 89%, fueled by luxury properties.
Noida led with a 152% jump in new project prices, from ₹5,910 to ₹14,946 per sq ft, and an 81% growth in the secondary market. Gurugram followed closely with a 135% increase, reaching ₹19,535 per sq ft, and areas like Wazirabad saw a 350% surge in circle rates. Delhi’s flat prices rose 170%, strengthening its premium market. Meanwhile, Mumbai’s MMR saw a steady 50% increase, reaching ₹15,650 per sq ft.
These trends highlight that investing in real estate today isn’t merely about where you live—it’s about making smart financial decisions that pay off over time.
With prices climbing steadily across mid, premium, and luxury segments, the property market offers immense potential for both buyers and investors. Whether it’s for personal satisfaction or portfolio growth, real estate is your gateway to long-term success.
Let’s explore why buying property is a game-changing investment beyond just owning a home.
Leverage – Your Secret Weapon to Wealth
Imagine owning a property worth crores with just a fraction of the cost upfront. Sounds like a dream, right? Well, it’s a reality, thanks to a powerful financial tool: leverage.
What is Leverage?
Leverage is the use of borrowed money to increase your potential return on an investment. In simple terms, it’s like using a lever to lift a heavy weight. That’s how leverage works in finance. You use a smaller amount of money (down payment) to control a much larger asset (the property).
Imagine you want to buy a house worth ₹5 crores. You might not have ₹5 crores in your bank account, but with a home loan, you can buy it. You pay a smaller amount upfront, say ₹1 crore, and the bank lends you the remaining ₹4 crores. So, you’re using a smaller amount of money to control a much larger asset.
How Does Leverage Works in Property?
- Small Down Payment, Big Gains:
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- Traditional Investment: To buy a ₹1 crore property, you’d need ₹1 crore.
- Leveraged Investment: With a 20% down payment (₹20 lakhs), you control a ₹1 crore asset.
- Price Appreciation:
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- As property values rise, your equity grows.
- Example: If your property appreciates by 10% annually, your ₹20 lakh investment grows significantly faster than a traditional savings account.
Let’s understand this with an example:
You buy a property worth ₹50 lakhs. You pay a 20% down payment of ₹10 lakhs. The remaining ₹40 lakhs is a home loan.
Now, let’s assume the property value appreciates by 10% annually.
- Year 1: The property value increases to ₹55 lakhs (50 lakhs * 1.10).
- Your investment: Your initial investment of ₹10 lakhs has now grown to ₹15 lakhs (the original ₹10 lakhs + ₹5 lakhs in appreciation).
So, even though you initially invested only ₹10 lakhs, your investment has grown to ₹15 lakhs in just one year, thanks to property appreciation. This is a significant return compared to traditional savings accounts.
- Tax Benefits:
In India, you can enjoy significant tax benefits on your home loan. Section 80EE of the Income Tax Act allows you to claim a deduction of up to ₹50,000 on the interest portion of your home loan in a financial year. This means you can reduce your taxable income and pay less tax. However, Consult a tax professional to understand the specific tax benefits in the country as per your annual income.
The Power of Passive Income
Owning a property isn’t just about appreciation; it’s also about generating income. Let’s explore two popular ways to do this:
- Rental Income
Rent out your property to tenants and receive regular income. This can provide a stable source of income, especially when coupled with other investment strategies. Infact, under the New Tax Regime, rental income up to Rs 10 lakh can be tax-free. Here’s how:
- Gross Rental Income: Rs 10,00,000
- Standard Deduction (30%): Rs 3,00,000
- Taxable Income: Rs 7,00,000
Since Rs 7 lakh is below the taxable income limit, no tax is payable on this rental income.
Assuming you own a 3-bedroom apartment in a prime location in a major city like Mumbai or Delhi, worth around Rs. 5 crore:
Rental Income Range:
- Minimum Annual Rental Income: 2% of Rs. 5 crore = Rs. 10 lakh
- Maximum Annual Rental Income: 4% of Rs. 5 crore = Rs. 20 lakh
Monthly Rent:
- Minimum Monthly Rent: Rs. 10 lakh / 12 = Rs. 83,333
- Maximum Monthly Rent: Rs. 20 lakh / 12 = Rs. 1,66,667
As mentioned earlier, you can claim a standard deduction of 30% on your rental income, along with other deductions like property tax, insurance, maintenance costs, and home loan interest. After considering these deductions, your net annual rental income could range from approximately Rs. 6 lakh to Rs. 13.33 lakh.
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- Holiday Rentals
You can also list your property on platforms like Airbnb for short-term rentals, often yielding higher returns than traditional long-term rentals. Earn during peak seasons (like tourist hotspots or festivals) and enjoy personal use during off-peak times.
Imagine owning a luxurious 5-crore villa in a prime tourist destination like Goa or Kerala. This property could be rented out as a high-end holiday rental, especially during peak seasons.
Peak Season Rental:
- Daily Rate: Rs. 15,000 per day
- Monthly Income (30 days): Rs. 4.5 lakh per month
Off-Peak Season Rental:
- Daily Rate: Rs. 10,000 per day
- Monthly Income (30 days): Rs. 3 lakh per month
Annual Income:
- Peak Season (3 months): 3 months * Rs. 4.5 lakh = Rs. 13.5 lakh
- Off-Peak Season (9 months): 9 months * Rs. 3 lakh = Rs. 27 lakh
- Total Annual Income: Rs. 13.5 lakh + Rs. 27 lakh = Rs. 40.5 lakh
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Building A Legacy By Purchasing A Property
Ready to build a future that’s as solid as a brick wall? Owning a property isn’t just about having a roof over your head; it’s about securing your financial future and creating a legacy. Imagine owning a piece of land, a home that appreciates in value over time. It’s a tangible asset that can provide stability, financial freedom, and a sense of security. So, why wait? Start building your future today with Bharatpropertty.com.
