Tax saving Via Home loan

As the financial year draws to a close, a lot of people feel stressed due to the final tax assessment for the year. It needs to be noted on this point that owning a home is not only a dream realization, but home loans are also wonderful tax saving instruments. Individuals having home loans are eligible for tax deductions on both the principal amount as well as on the interest paid for it. Let us take a simplistic look at the various tax deduction options one can avail while servicing a home loan.

Tax benefit on Principal Amount of Home Loan:

The principal amount paid on any home loan can be availed as tax benefits with a maximum deduction of Rs 1,00,000 under section 80C of the Income Tax Act. However, it needs to be noted that the deduction is not available for any principal amount paid on home loan for an under construction property. The maximum deduction allowed under Section 80C of the Income Tax Act is Rs 1, 00,000.

Tax Benefit on Home Loan Interest:

The amount paid as interest towards the repayment of home loan is available for tax deduction under Section 249 b of the Income Tax Act 1961. A deduction up to Rs 1,50,000 is available for interest rates.

Illustration:

Suppose Satish has a total taxable income of Rs 4, 00,000. Let us suppose he has paid Rs 1, 10,000 as the principal repayment for the home loan in the same year as well as Rs 1, 60,000 as interest. Since the total tax deduction available for Satish is Rs. 1,50,000 towards interest payable & Rs. 1,00,000 for principal repayment of the loan, Satish’s tax obligation will be reduced  to Rs. 1,50,000 ( Rs. 4,00,000 – Rs. 2,50,000 )

Comparison Chart for Tax Benefit on Home Loans:

	Section 24	Section 80 c
Tax Deduction for	Interest Amount	Principal Amount
Maximum Tax Deduction	Rs. 1,50,000 for self occupied property	Rs 1,00,000
Other Eligibility Conditions	Construction or Purchase must be completed within 3 years of Home Loan	None
Restrictions	None	Tax Deductions would reverse if property is sold before 5 years.

House Rent and HRA:

A lot of people face a dilemma over availing tax deductions on home loans and house rent allowance or HRA. If one takes a home loan but continues to live in a rented accommodation, one is entitled to both home loan deductions under section 24 and section 80c as well as HRA benefits. The only condition is that one can claim tax benefits on the home loan only if the home is ready to live in during the same financial year. Some people for job purpose live in a rented accommodation themselves, while their self owned home is rented out. In such a scenario both HRA benefits and house loan tax deduction benefits can be availed, but the rental income received is taxable.

Multiple Housing Loans and Tax Rebate:

In case you have taken multiple housing loans for two di

fferent properties, you are allowed to avail tax rebate for both, but however that maximum deduction available for the principal and interest portion is fixed at Rs. 1, 00,000 and Rs.1,50,000 lakhs respectively. Any amount payable beyond this is not subject to tax rebate.

Home Loan benefits for Under Construction Property:

For any under construction property acquired through a home loan, the total interest paid on the principal amount during the construction period can be claimed for tax benefits. The principal portion repaid before the completion of construction however is excluded for deductions under 80C of the Income Tax Act 1961.

However, tax benefits are not available for top up home loans or loan against land purchase.

Yerwada: One Of The Most Preferred Real Estate Destination In Pune

Located in the North East, Yerwada is highly preferred for renting properties. Proximity to IT hubs and advent of Grade-A office spaces is pushing housing demand here. And thus, the locality has been recording increasing rental values in the last one year. As per the data  the rental values in Yerwada, Pune have gone up by almost 20 per cent in the last one year, which is one of the highest in the city.

As per a report by Jones Lang LaSalle India, a leading Real Estate Consultancy, Yerwada is one of the most active absorbers of IT office spaces in Pune. Another report by Cushman & Wakefield suggests that the locality is expected to house a major portion of the total new Grade-A office space coming up in Pune in 2014. Presence of ample job options and the subsequent increase in these opportunities is attracting numerous home seekers to Yerwada.

Throwing light on the preference of the location amongst the temporary home seekers, Kapil Khatri of Khatri Estate says, “With time, Yerwada has developed in a systematic manner. Being surrounded by several large scale companies such as Bajaj Allianz, IBM and TCS, Yerwada is highly sought by professionals working nearby. While Kharadi and Magarpatta, the IT hubs of East Pune, fall at a convenient distance, the locality is also eyed for its well-built social infrastructure in terms of entertainment and recreational amenities, healthcare facilities and educational institutions.”

Presently, the rental values for a 1000-sq-ft 2BHK apartment in Yerwada, Pune range from Rs 16,000-20,000 per month. A year ago, a similar apartment was rented for nearly Rs 12,000-16,000 per month. The owners of the locality have not only been enjoying the overall rise in the value of their property, but also the additional monthly income coming through it. “Being close to Koregaon Park and Kalyani Nagar, Yerwada has emerged as an affordable rental option. The houses by Maharashtra Housing Board and in its adjoining societies offer a great location and also fall easy on the pockets of middle-income segment homebuyers,” says Neelima, a resident of Yerwada.

Yerwada is not only close to the most-visited workplaces, but also offers a well-built connectivity to these areas. While the Pune-Solapur Highway falls at a distance of hardly 6km, the Mumbai Highway (Ambedkar Road) is about 5km away. One can easily catch buses and autos to commute from here. For intra-city connectivity, both airport and railway station fall within a radius of 6km.

Thus, it seems quite evident, that Yerwada is not only ideal for the end users, but also offers a good scope for the investors who can aim for high rental income in future.

Want To Own A Ferrari In Just Five Years , Then Read This !!

Real estate is a lucrative field, which is precisely the reason why it is often regarded as a get-rich quick investment tool by many. But as with many other investment avenues, investing in real estate has its pros and cons. But with careful consideration, you can own your very own Ferrari in 5 years with successful investments in real estate.

You have to remember these basic tips to make a fast entry in real estate and become successful within a short duration of 5 years:

1) Educate yourself

Watch the actions of successful investors and learn from their experience. You can also pursue property investing courses to gather more knowledge. Many such courses can be pursued online and are conducted by experienced real estate professionals. This can help you make the right decisions while investing in real estate purchases.

2) Gather capital

As you know, property investment demands high capital. Use or own capital or manage it from other sources. The financial arrangement should be done such a way that a poor decision on your part won’t land you or your lender in serious financial trouble.

3) Go rehabbing

Rehabbing, also known as ‘Fixing and flipping homes,’ basically means buying a low-priced property and selling it after doing some renovation. If you are a master at renovating low-priced homes, you can make a huge profit from reselling.

4) Try wholesaling

This requires you to put a property under contract and selling the contract afterwards to a buyer, wholesaler or rehabber. The thing to consider here is that, you are not directly purchasing the property while wholesaling. You are merely putting in within contract. This can help you earn a lot of money within a very short time period, sometimes within a single week, without entering into potential risks associated with property purchases.

5) Rental properties

It is another profitable real-estate investment that requires you to buy a property and hand it over to a tenant under lease. You can be assured of a fixed monthly income from the rental fee paid by the tenant. Apart from purchasing the property, you also have to pay for the taxes, mortgage and maintenance costs involved. Naturally, you should try this type of investment only after careful consideration.

Can You Make Fast Money in Real Estate Investments?

It is often asked whether one can successfully make money in real estate within a short time. It must be stressed that the results vary from one individual to another. If you make smart decisions, gain knowledge about the current trends, work hard and do not let emotions cloud your property investment decisions, nothing can stop you from achieving success.

While it may seem difficult at first, remember that there is a reason why the real estate industry has gained much popularity in the last few years. If you wish to make a lot of money within 5 years, the real estate industry is one of the best places you can give a try to get your hands on that dream machine. After all, the biggest stock investor Warren Buffet has a great real estate portfolio to flaunt!

नारी तुझ पर संसार गर्विता

तन चंचला
मन निर्मला
व्यवहार कुशला
भाषा कोमला
सदैव समर्पिता |

नदिया सा चलना
सागर से मिलना
खुद को भुलाकर भी
अपना अस्तित्व सभलना
रौशन अस्मिता |

सृष्टि की जननी
प्रेम रूप धारिणी
शक्ति सहारिणी
सबल कार्यकारिणी
अन्नपूर्णा अर्पिता. |

मूरत ममता
प्रचंड क्षमता
प्रमाणित विधायक
सौजन्य विनायक
अखंड सहनशीलता |

आज का युग तेरा है परिणीता
नारी तुझ पर संसार गर्विता |

हमारी सारी बहनो और साहिलियों को नारी दिवस की हार्दिक शूभेच्छा

Source :http://mehhekk.wordpress.com/2008/03/08/nari/

Thinking Of Applying For Home Loan ? Is This Right Time ?

Most home buyers in India look for a home loan while buying a property. But, is there a right time to apply for a home loan? With the present economic uncertainties, one must think whether it is a good time to apply for a home loan or one should wait for better economic stability and correction in property prices in certain real estate markets in the country.

Factors to consider

Applying for a home loan has gained more significance in present times. In the past people were inclined towards saving some money and then buying a property while today people are willing to go for a home loan for buying a property. But before applying for a home loan one must consider several aspects.

1. The location of the property is a primary factor to be considered. For example, one may be able to buy a property in Bangalore with a smaller home loan while the same property in Mumbai will cost more leading to a higher loan amount. Applying for a home loan also depends on what the person’s future plans are. If you are planning to settle down in a particular location for a long term then you can apply for a home loan. Else, staying in a rented property would be ideal.

2. If you are confused whether paying a housing loan EMI is a wiser choice than paying a rent, it depends on the loan amount you plan to go for. You must also consider this thumb rule: A person’s home loan EMI should be within a rational percentage of his/her net monthly disposabl

e income. EMIs on home loans can generally amount to about 50% of the monthly income.

3. If you are looking from a perspective of investments, there are certain markets in India at the moment such as Bangalore, Pune and Hyderabad which are ideal for investment. These cities are growing very fast in terms of real estate and promise good returns in the future. Hence, this is the right time for applying a loan if you plan to buy a property in these cities.

4. In other cities such as Mumbai and Delhi where people are currently following the wait-and-watch policy in anticipation of price correction, one must understand that there may be low to no chance of price correction. The real estate markets in these cities have, at best, shown minor price correction in certain micro-markets. Else, prices have remained stable over the past few quarters. Furthermore, economic indicators suggest that inflation will only drive the costs higher and there are no prospects of interest rates on home loans rationalizing over the mid-term. Hence, it may be the right time to go for a home loan and purchase a property.

Apart from these factors, one should remember that he/she is under legal obligation to make regular payments of their home loan EMIs. One should undertake due diligence regarding their financial capabilities of taking a loan and repaying it. If not, they may find themselves in debt traps and possibly default on their repayments. This could have legal implications as well. A home loan strategy should also not be based on anticipated financial windfalls. It should be based on realistic income factors such as a salary hike, maturing insurance policies and investments.

While there is no perfect time for taking a home loan, it is advantageous to consider these factors before applying for a home loan.

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Consumer Outlook 2014 For Real Estate

India’s real estate market is largely emotionally driven and a lot depends on the sentiments persisting in the market. Despite the weak macro-economic environment in 2013 due to high inflation, rising interest rates, stagnant growth and rising fiscal deficit, the real estate sector saw stable demand during the year after recovering from low in the period during 2011-2012 with build-up of sufficient inventory.

To understand the expectations and sentiments of property buyers and real estate investors for this year,a real estate portal  recently conducted the survey titled Real Estate: Consumer Outlook 2014.

The survey received overwhelming response from potential property buyers and investors who are planning to buy property in 2014. The majority responded that they expect there will be a significant impact on the real estate demand and buying post Lok Sabha elections in May-June.

Participants indicated their preference for investing in real estate in 2014. A significant number of participants are ready to invest or buy property this year. While comparing this result with As per a  real estate survey 2013, there was a significant increase in the number of people ready to invest or buy property this year. This indicates a positive outlook for the real estate sector in 2014.

As for the preferred destinations for Property Investment, a majority opted for Tier 1 cities but, interestingly, Tier II cities also saw an increasing demand.

Further, the survey also indicated the property-type preference of the participants. New trends are emerging in the industry and the choice of people clearly indicated this.

Other than real estate, participants also considered various other options for investment such as fixed deposit, gold, stocks and Mutual Funds. There was a clear preference for fixed deposit as people considered it a safe option.

The survey, further, highlighted the budget preference of buyers clearly indicating that there is a huge demand for affordable housing.

Interestingly, buyers feel that the general elections will definitely impact the real estate sector in some way or the other. While most expect some price corrections, there were also a few who felt that the election will not impact or influence the real estate sector in any way.

The survey also indicated that there is significant ambiguity over the Real Estate Investment Trust (REIT), a novel investment tool proposed by SEBI. The government will have to, thus, create more awareness about this. On the other hand, participants who did have information about REIT showed an inclination towards it.

The general sentiments reflected through the survey also highlighted that people have high hopes from the Real Estate bill. Participants feel that it will bring in the much-needed transparency in property dealings through provisions for registration of real estate projects and agents with the Real Estate Regulatory Authority; functions and duties of promoters and agents; rights and duties of allottees etc. On the contrary, few participants also felt that the Bill will increase delay in the projects due to another layer of bureaucracy.

Lastly, the survey also highlighted that people now have moderate return expectations from the real estate sector unlike before. The present conditions of the sector has made investors believe strongly that real estate will not give the same returns as before.

Summary

There is a great demand in the residential sector for affordable housing and Real estate sector should respond to this demand by incorporating better technology and efficient resource utilization. Property buyers and Investors are waiting to see new trends emerge in real estate buying or investment in 2014 post the general elections. Our survey also highlights that there is a strong need to bring in reforms in the real estate sector and make it more transparent and investor-friendly as shown by expectations from Real Estate Regulatory Bill and REIT.