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DerpyPancake
DerpyPancake
PhonePe

How much maximum loan should I take ? Advice needed

Hi All,

I am interested in a property in my hometown that costs around 3.5 Cr. This property can easily be rented out for atleast 1.5 LPM. I have saving of around 1 Cr, should I take a loan of rest of the amount ?

I make around 70 LPA, 54 is fixed and rest is ESOPs. My wife makes around 12 LPA.

What do you think ? Should I take this loan ?

6mo ago
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BouncyMochi
BouncyMochi
Freelancer6mo

Grab the opportunity. You won’t regret.

SqueakyKoala
SqueakyKoala
Walmart6mo

Is it a land or commertial, you may take it. For residential may not be a good buy.

MagicalNugget
MagicalNugget
Linkedin6mo

If its a residential property (very unlikely), why would it be not a good buy?

BouncyNugget
BouncyNugget
Salesforce6mo

Calculat rental yield vs what if you put this money in a mutual fund where you get avg. 12-15% return over next 10 years. But since you are already earning well, try to close your loan within half the time, so your interest component is low. Try some maths and how can you make it work for you, if you really wanna go forward with it.

FluffyCupcake
FluffyCupcake
Amazon6mo

At 1.5L/month, the rental yield of this investment would be ~5%. Though it’s not clear if it’s a residential/commercial property but I assume there would be some maintenance charges as well. So do all those maths and try to evaluate.

Some more questions to think about-

  1. Will you need own house in work-city?
  2. Will this investment lead to asset class concentration?
  3. Do you see further growth potential in the city?
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