Know the Ideal Age for Investing In Real Estate
Jun 01, 2017 Home Trading Steps
It is generally believed that investment in property is ideal for people who have a long upwardly mobile career ahead of them. That is to say that people who are nearing the retirement age should not look as property as an investment. But, this conception needs to be analysed in order to have a better understanding. Is it okay to believe that there is an age limit to invest in property? Can one grow older and miss the ideal age of investing in property? Let’s examine this from the point of view of banks, lenders and other stakeholders in the property sector.
Banks are believed to be hesitant in giving long term home loans to a person nearing the retirement age. This, understandably, does not make much sense to the bank. On the other hand, a person in their 30’s has around 30 years of professional life to earn and repay the loan. Even for a well earning person in the age group of 40’s, there is enough time to invest in property as they have 20 or even more years to safely take risks. But, this conception is increasing changing in recent times. Banks in Indian are accepting the fact that that people work and earn even after the conventional retirement age of 65 years and are financially active.
The fact that property investment becomes profitable when compounded over time is also a factor in assuming that one should invest sooner in their career lives. For people in their 30’s and 40’s, there is plenty of time ahead of them to gain higher profits by seeing their investment mature over time.
Individuals with a good portfolio of assets attain certain credibility with banks as their property can be counted upon as collaterals for a fresh loan even when the individual is close to retirement age. But, such individuals should invest with caution and stay away from taking market risks beyond the age of 55.
With the increase in age, the strategy of an individual should be to increase the value of their existing assets through well proven means instead of taking risks. If a person beyond the age of 60 wants to invest in a property, one must have tremendous confidence in one’s personal finances and also a good understanding of the market. As it is technically possible to take a home loan even after retirement under certain criteria, people with sound financial background might be interested in dealing in the property sector.
If we talk about buying a house for personal use instead of investment, then the scenario is very different. For such buyers, there is no ideal age for purchasing a property. For instance, buying a house at the retirement age for personal use makes perfect sense for people who have been living in a rented accommodation throughout. This gives them freedom from monthly rent expenditure and also provides financial security. It can be used to raise funds during an emergency situation. People also believe that property is a decent asset that can be left behind for the next generation.
Thus, for investment purposes, there definitely is an ideal age limit. But this is flexible depending on various factors. And financially sound individuals beyond this ideal age limit might also be active in the market. But, as far as buying a house for personal use is concerned, there is no ideal age. Owning a home to live in is considered a source of security and financial freedom.
Banks are believed to be hesitant in giving long term home loans to a person nearing the retirement age. This, understandably, does not make much sense to the bank. On the other hand, a person in their 30’s has around 30 years of professional life to earn and repay the loan. Even for a well earning person in the age group of 40’s, there is enough time to invest in property as they have 20 or even more years to safely take risks. But, this conception is increasing changing in recent times. Banks in Indian are accepting the fact that that people work and earn even after the conventional retirement age of 65 years and are financially active.
The fact that property investment becomes profitable when compounded over time is also a factor in assuming that one should invest sooner in their career lives. For people in their 30’s and 40’s, there is plenty of time ahead of them to gain higher profits by seeing their investment mature over time.
Individuals with a good portfolio of assets attain certain credibility with banks as their property can be counted upon as collaterals for a fresh loan even when the individual is close to retirement age. But, such individuals should invest with caution and stay away from taking market risks beyond the age of 55.
With the increase in age, the strategy of an individual should be to increase the value of their existing assets through well proven means instead of taking risks. If a person beyond the age of 60 wants to invest in a property, one must have tremendous confidence in one’s personal finances and also a good understanding of the market. As it is technically possible to take a home loan even after retirement under certain criteria, people with sound financial background might be interested in dealing in the property sector.
If we talk about buying a house for personal use instead of investment, then the scenario is very different. For such buyers, there is no ideal age for purchasing a property. For instance, buying a house at the retirement age for personal use makes perfect sense for people who have been living in a rented accommodation throughout. This gives them freedom from monthly rent expenditure and also provides financial security. It can be used to raise funds during an emergency situation. People also believe that property is a decent asset that can be left behind for the next generation.
Thus, for investment purposes, there definitely is an ideal age limit. But this is flexible depending on various factors. And financially sound individuals beyond this ideal age limit might also be active in the market. But, as far as buying a house for personal use is concerned, there is no ideal age. Owning a home to live in is considered a source of security and financial freedom.
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