Home ›› 25 Apr 2022 ›› Opinion
First, we need to know whether a middle-class family should invest a lot of money to buy a flat. It was generally believed that they would have to invest a large portion of their whole life's income to buy a flat. But now, according to this writer, the middle-class families living in a metro area of Dhaka or Chittagong must proceed towards buying a flat according to their minimum income and with a proper plan. They are already spending 40 to 50 per cent of their monthly salary on the rent. It is visible that the middle-class families billing the rent calculated in 20 years is 70 to 80 per cent of the cost of a medium-sized flat. This money can be placed in a good investment, which can be possible after a flat. You can get ready with the money you are spending for a long time.
You can think of buying a flat if you can arrange 20 per cent of the original price of a flat and some more money with an installment from a bank that is a little more than your current flat rent. Suppose a middle-class family spends an average of 2 lakh BDT per year on rent. If you calculate your residence's rent for 20 years, the total cost will be more than 4 million BDT. The house rent increases every two to three years. With the same amount of money, you can buy a flat by taking a loan from the bank and repaying it in many installments. If you purchase a ready flat with a bank loan and add some more money that was used to pay rent every month, your installments will be finished within the time. Then you will be able to save the installment money in a new way every month. At that time, the sale rate of that flat will increase more than the previous times. But many people living in Dhaka city do not understand this simple calculation. Some of them have a clear explanation, but they do not have enough money during the time of investment, and as a result, they are paying the house rent year to year. And their next generation is doing the same.
There are basically three things a buyer or investor can arrange to be a proud owner of a flat. Firstly, arrange at least 20 per cent of the original price of the flat to buy a flat. Many banks or finance companies offer loans up to 80 per cent. Secondly, you must have a job or business to take a loan from a bank. Of course, those renting in Dhaka city every month have some job or business. However, it doesn't matter the type of job or business, but you have to be qualified to get a loan and meet their requirements according to the banking rules. Thirdly, the ability to repay the loan by adding more money to the rent you pay each month. Basically, these are three things a middle-class person can do. With the correct planning and proper guidelines, one can definitely own a beautiful flat for living. Some people may influence you not to invest in a flat, and they may advise you to go for a fixed deposit to get interest from the bank every month. But now, the bank interest is less than what was earlier. So, investment in a flat is beneficial for those who are spending money on house rent and can get a loan from a bank because now bank interest is less than you can survive on. In areas where socio-economic development is accelerating day by day, flat prices will rise in just two to three years. But price depends on location, which can be explained by a real estate consultant doing market research, analysis, and observation in this area. And they can afford a better suggestion for you.
The above discussion is basically about economic planning or fund collection. Many people think that flats can be bought easily only with money or necessary fund collection. This is not correct at all. In recent years–from a case study– it has been seen that people have managed their funds for buying a flat. Still, there are many problems regarding the related issues, which results in hassles in the buying process. Buying a flat with proper rules must be done by following several steps. For example, the appropriate way is to collect data on salable flats, maintain home inspection, project visit, flat valuation from a real estate point of view, documentation check, responsible negotiation, standard area calculation, sales permission, sales agreement, etc. And this whole process needs to be done with the help of a real estate investment consultant. Important decisions like buying a flat can lead to many problems in the future if not made through a professional real estate investment consultant. It may be extremely difficult to solve all these complex problems in some cases.
You can get help from a lawyer, civil engineer or banker. Still, an investment consultant must be by your side for all the real estate market research and observation and understanding all the rights of a buyer without any hassles to find a flat without registration or even mutation. A significant number of middle-class families can afford to buy a flat. Still, nowadays, a show-off culture dissuades them from making the right decision. As a result, many of the investments are made for the sole purpose of showing off. There are times when they spend money without having any foresight. For example, they buy a car without thinking about the maintenance cost. They believe that the vehicle would gain social status among the so-called elite people in our society.
It is necessary to focus on meeting the basic needs with the hard-earned money. The potential buyer should keep in mind that you can build the most essential economic foundation for yourself and future generations with proper guidance and management. Buying a flat in the city is not only to get a shelter. Instead, this property can, directly and indirectly, help you in financial, social, and emotional well-being.
The writer is a real estate and investment consultant. He can be contacted at rayhan8484@gmail.com
