How Much Home Can You Afford in India? A Beginner’s Guide

📊 1. Understand the 28/36 Rule

This global budgeting rule helps assess how much debt you can handle. According to the rule:

• Your housing expenses (EMI, insurance, taxes) should not exceed 28% of your gross monthly income.
• Your total debt payments (EMI, credit cards, loans) should not exceed 36% of your gross income.

Sticking to this rule ensures financial stability and avoids overstretching your budget.

🧮 2. Calculate EMI Based on Income

The most accurate way to determine affordability is by calculating your EMI (Equated Monthly Installment). Use an EMI calculator to check how much loan amount you can handle based on your income, interest rate, and loan tenure.

Example: If you earn ₹60,000 per month, a safe EMI would be ₹16,000–₹18,000 (28–30%).

💰 3. Don’t Forget the Down Payment

Most banks in India require a minimum down payment of 10%–20% of the property value. Make sure you have savings for:

• Down payment
• Registration & stamp duty (5–8% in most states)
• Home insurance, maintenance & furnishing

Set aside this amount before applying for a loan.

🔍 4. Check Your Credit Score

Your credit score impacts the interest rate on your home loan. A good score (750+) qualifies you for lower rates, increasing affordability. Monitor your credit health before applying.

📱 5. Use a Financial Calculator App

To avoid manual calculations and guesswork, use the SIP & Home Loan EMI Calculator app to:

• Calculate EMI based on your income
• Estimate maximum loan eligibility
• Compare different interest rates and tenures
• Plan SIPs for down payment savings

It simplifies complex calculations and helps you stay within a realistic budget.

✅ 6. Tips for First-Time Home Buyers in India

• Get pre-approved for a loan before house hunting
• Consider upcoming infrastructure in the area
• Factor in maintenance costs and property taxes
• Don’t stretch beyond your comfort zone just for a dream home

📌 Final Thoughts

Your first home should feel exciting—not stressful. By sticking to affordability rules, using a home loan EMI calculator, and budgeting wisely, you can buy a house that meets your needs and fits your finances.

Remember, a well-planned purchase today builds your financial security tomorrow.