Hot Tips: A Mother's Day Message About Buying Property
If Marilyn Monroe made diamonds the most desirable luxury for women to own, the craze around the precious stone might just be overtaken by property purchases. As a number of realtors and bankers testify, women are increasingly becoming home buyers in India. According to a rough estimate, about 30% of home buyers in urban India are women.
If you are a woman looking to make smart investment decisions to secure your children's future, you should begin this Mother's Day on May 10.
Here are top four reasons why owning a home is profitable for you and your family:
1.Tax rebates: Home investments are great for claiming tax rebates. You can claim a tax deduction of up to Rs 2 lakh on the interest payment. If you rent out the house, the interest paid on the home loan can be deducted against the net rental value. By owning the house with your spouse, both can claim a tax deduction of up to Rs 2 lakh on the interest paid on the home loan.
2.Cheaper home loans: Many banks charge lower interest rates while extending home loans to women. The ICICI Bank, for instance, charges an interest rate of 10.15% or upward for home loans. But, the interest rate for women is 10.10% or upward. Even though the difference in the home loan interest rates isn't often significantly high, you can save a substantial amount of money by buying the house in your name if the principal amount is high. It is also easier for a woman to get a home loan because banks see them as more regular with the interest and EMI payment.
3.The abolition of wealth tax: Your spouse can claim exemption from wealth tax by buying property in your name. However, this is often seen as a Benami transaction. To get around this, spouses often gift or loan women the money to buy a house. Yet, stamp duty is usually levied on this gift. In the Union Budget 2015-16, the Narendra Modi government proposed abolishing the wealth tax. From April 1, 2015, you can buy the house in your name without fear or guilt.
4.Lower stamp duty: The stamp duty levied while buying a house is fraction of its value, or the market price of the house, whichever is greater. Though stamp duty varies across states, women who buy houses pay lower charges. If you jointly own the house with your spouse, the stamp duty levied will still be lower, through this varies from state to state. Women can save even up to 1-2% of the value of their homes on stamp duties by buying the house in their names.
So, what are you waiting for? This Mother's Day, do consider buying yourself a house.