Preferred property options for first time buyers

There is a broad distinction between first time home buyers and second time buyers. First time buyers shall be making such a huge investment for the first time in their life which is why they invest a lot of time in researching the market. Unless extremely lucky, it may be the only asset of this scale, they purchase which is why they take into account every possible information before making a decision.

  

Studies have revealed that there are certain recurring traits among first time home buyers across different cities. Some of these recurring trends have been explored below:

First time buyers prefer purchasing apartments:

      Roughly 7 out of 10 first time buyers prefer purchasing an apartment over row houses or builder floors.

Apartments are cheaper and provide all the amenities that are needed to live a good life. Home buyers of Tier I and II cities prefer purchasing apartments mostly. Usually home buyers prefer buying 2 and 3 BHK properties.

         Preference for ready to move in properties over under construction ones:

This can be considered to be paradigm shifts in terms of the buyer’s psyche. Even some time ago, first time buyers preferred buying under construction properties because they were less expensive. However, most buyers prefer to buy ready properties because of delays in under construction ones. A lot of first time buyers also prefer to buy houses in communities which are under construction but offer possession within 2 years. Ready to move in properties offer rent saving and tax deduction up to Rs 2 lakhs per annum on the interest paid on home loans. The only issue with ready to move in properties is that they are more expensive compared to under construction ones. However, buyers are willing to go that extra mile.

       End usage is the dominant cause behind property purchase:

Usually first time buyers prefer to purchase an apartment for living in it rather than subletting it for rental income. First time buyers usually live in rented accommodations which they want to give up when they buy a property. Only a handful of first time buyers prefers to buy properties for subletting it to others or earning capital gains from it or tax benefits.

       Property purchase is for families rather than self-occupation:

First time buyers usually prefer to buy properties to live in with their families. They would rather buy apartments or houses with multiple rooms to accommodate the 3-5 members of the family. Only a handful of people prefer buying single room apartments for self-occupancy.

       Location and pricing are the two most important considerations for purchasing a property for first time buyers

Prime locations and budget are the two most essential points which are considered by first time buyers. Surveys have revealed that price is the top most consideration while locations came close second. Other parameters that a first time buyer must consider is connectivity to different areas via public transport, builder reputation, closeness to work, social amenities and size. Home buyers essentially look for properties in India which are closer to their preferred location, within limited budgets. It can be seen that over the past 10 years, that capital appreciation has been seen in areas which are well connected and close to prime locations more compared to other areas.