Is it possible for me to buy a land and construct a house?
Ramesh is an interior designer from Calicut, Kerala. He is aged 39. His wife is a home maker. They want to buya piece of land and construct a house in 5 years. The expected cost in today’s value is Rs.45 lakhs. Currently he can set aside Rs.12 lakhs for the goal. Further, he can save Rs.5000 every month towards this goal. He has investments in mutual funds, chit and life insurance plans. He wants to know if it’s possible to achieve his goal and if so how to go about?
Ramesh’s situation was analysed and provided him strategies and advice to achieve his goal as given below:
Cost of buying land and construting house in today's Value
Cost after 5 years assuming price change @ 10% p.a.
Assets set aside for the goal in today's value
Monthly Savings that can be allocated to this goal
Suggested Asset Allocation
Assuming Moderate Risk Tolerance and Short time horizon the following asset allocation is suggested to deploy the assets allocated for the goal and to allocate the savings
The above case study is for illustrative purpose only and is not a recommendation or advice for a similar situation you might face since there are many other factors which will require a different approach to your situation.
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