BUISENESS MANAGEMENT
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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if you want to benefit from increase in property value
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if you want to stay in the house for a few months
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if you want to save on upfront costs
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None of the above
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Detailed explanation-1: -If the property’s price is less than ₹60 lakhs, the rent ratio is favorable for purchasing the property instead of renting. But, if the price of the house is over ₹60 lakhs, renting it makes more sense.
Detailed explanation-2: -In conclusion The opportunity cost of buying a home is much higher than renting one. However, if you are at a stage where you are stable in life and with your finances, this can be the correct next step for you. Ensure that you consider all costs and choose a home that fulfils all your supplementary needs.
Detailed explanation-3: -Advantages of owning a home over rental accommodations: # It gives a sense of security and pride of home ownership. # Rent is an expense that is incurred every month without creating any physical asset.
Detailed explanation-4: -The case of Renting – No debt, tax benefit of HRA, and flexibility of change. So, for the initial few years, living on rent, will give you the breather to sort your finances and save some money toward buying a house. Also if you are living on rent, you can claim the tax benefit on your House Rent Allowance (HRA).