Is house price or interest rate more important?

A home is a one-time investment for many. As such, when one thinks of buying a home, various factors have to be taken into consideration like the market value of the house, home loan interest rate, maintenance costs etc. Though the price of a house would appeal to you, if the home loan interest rates are steep, then it could stretch your finances beyond your affordable range.

So, which is more important while buying a house – the price or home loan interest rate? Let’s find out.

Low Housing Price Advantages

• The lesser burden for the home loan borrower in arranging for a down payment
• Lower EMIs making it easy on their pockets

Low-Interest Rate Advantages

• Cheaper home loans at a low rate of  interest meaning less interest to be paid
• Higher savings for the home loan applicant
• Reduced loan burden for the borrower

As you can see, both home price and interest rates on a home loan are important criteria that have to be considered before buying a home. Before you purchase a home, make sure to check whether the house price and home loan interest rate are both within your budget and affordability.