Stock SIP or Loan- What Is A Better Way to Buy Your Own House?

Purchasing your first home is a big financial commitment. First-time buyers might get help from a home loan to realize their ambitions. Even if you take out a loan to buy your first house, you will still need to save up for a sizable down payment. 

Let’s say you are looking to purchase your first house. The property you’ve picked is worth Rs 50 lakh. Banks often lend up to 65 to 85 percent of the property’s value. If the bank grants you an 80 percent loan on the total property value, you’ll still need to come up with the remaining 20% from your resources, which means you’ll need Rs 10 lakh (20 percent of Rs 50 lakh) as margin money to buy your first home. The bank will only begin disbursing your loan once you have paid your portion.

You may easily arrange the necessary funds to purchase your first home if you plan and invest your money wisely, preferably in stocks.

To save money for the down payment, invest in stock SIPs.

A stock SIP allows you to put money in a stock market via online investing regularly over a a lengthy period. You can start a SIP specifically for your down payment on a property loan. Depending on the type of fund you choose and the length of time you spend, you can easily earn a return of 10% to 18%. If you invest Rs 10,000 per month in a stock SIP, you will get a 16% annual return. Thus, you will have collected a corpus of Rs 9.2 lakh after five years.

The hardest part of purchasing a home can often be gathering the amount for a down payment. SIPs, or systematic investment plans, can make the process of investing in stock more successful. If you save Rs 20,000 each month, you can put your monthly savings in a 6.5 percent sweep-in fixed deposit. It will take 6.65 years to accumulate Rs 20 lakh. If you put the same money into a good equity fund using SIPs, you’ll be able to build up the requisite corpus in 5.76 years if the fund earns 12% per year.


SIPs assist you in remaining disciplined throughout the procedure. Many of us may be discouraged at first since the target down-payment amount is so scary. We can construct the requisite corpus by taking tiny steps over time. SIPs also shield you against market ups and downs by allowing you to average your investments over time. You can also easily invest in stock market. They allow you to benefit from market-linked returns while limiting your risk.

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