Why getting rentals can help you?
Everyone aspires to have a dream home. When living in a rented apartment, there’s this little voice at the back of the head saying “Wish we had our own house.”
There’s no doubt that rentals burn a hole in your pocket without adding to your assets. And you are constantly trying to think of ways to get out of them. However, rentals can be good.
That’s where the EMI-FREE offers come in. Basically, the money that you save on paying EMIs can be used to pay rentals. Though as of now rentals may seem cheap as compared to the EMI — in the long run, they are much higher than the cost of owning a house.
However, rentals can be a boon in many cases. If you can use rentals to your home-owner advantage. Here’s how
You can rent out the property & invest in another home
If you already have an apartment or home, you can rent it out. The money you get from the rentals can be used to reinvest in another home!
Save more since EMIs take care of rentals
In many cases, builders are offering FREE EMIs. What this means is that the builder will pay for a certain number of EMIs till you get possession. In such cases, you can make use of this money to pay your rentals.
You don’t sell but rent to get monthly income
For senior citizens, rentals are a great source of income. While many senior citizens choose to rent a room or have a paying guest, some prefer renting out the entire property. They may prefer shifting to a senior citizen home or get a smaller flat. The bigger one can help them generate rentals, which can take care of both EMIs and also give additional income.
Repair & utility managed by tenants
If you have rented out your apartment then there are a lot of aspects that would be taken care of by your tenants.
For example, your repair & utility bills would be managed by the tenants. In such cases, a lot of miscellaneous costs are spared. Even the building maintenance is taken care of by the tenant.
Wait for better market rates
If you want to sell of your property then getting rentals till market rates stabilise and then sell your property. If the market is slow, then you don’t really want to close a deal. In such cases, rentals are a boon. You continue to make money and then sell your property when rates are better.
Tax benefits of being a landlord
Of course, there are multiple benefits of being a landlord in India. You get tax exemption and relief.
As per Section 24 of the Income Tax Act, a landlord can claim a standard deduction of 30% on the net annual value. Their home loan interest is also fully deductible.
This is how his income from house property is calculated.
Having your own home gives a range of psychological and financial benefits — and if you rent it out, there are a lot more to be added.