5 Smart Tips for Owning Your Dream Home Within Budget

Owning your dream home often feels like a big, unattainable dream—especially when it comes to budgeting. Many people are unsure where to start, afraid of miscalculations, or worried that costs will spiral out of control. However, with careful planning and strategic steps, you can achieve your dream home without compromising financial stability. Let’s dive into these practical tips to help you plan your home-buying budget wisely!

1. Evaluate Your Financial Situation

The first and most critical step is to assess your current financial condition. According to Indonesia's Financial Services Authority (OJK), your monthly home loan payments should not exceed 30% of your income. This ensures that you can cover daily expenses without feeling overwhelmed by your mortgage.

Steps to evaluate your finances:

Record all monthly income and expenses in detail.
Set aside an emergency fund equivalent to 3-6 months of expenses before committing to a home loan.
Address any existing debts to improve financial health before purchasing a home.

If your finances aren’t ready, it’s wiser to postpone the purchase and focus on improving your financial stability first.

2. Set Your Dream Home Priorities

Buying a home isn’t just about price or location—it’s about long-term needs and comfort. Identifying priorities before starting your home search is essential.

Key factors to consider:

Location: Is it close to work, schools, or essential facilities?
Size: Ensure the house size fits your family’s needs.
Price: Set a maximum budget based on your financial capacity.
Facilities: Check for basic amenities like electricity, clean water, and infrastructure.

Furthermore, a strategic location is one of the primary factors influencing house prices. Homes in highly accessible areas often have better investment value, even if they’re slightly more expensive.

3. Calculate the Upfront Costs

Besides monthly installments, you need to prepare upfront costs, such as:

Down payment: Typically 10%-20% of the house price.
Notary fees and taxes: Around 5%-7% of the house price.
Administrative fees: Vary depending on the financing institution.

For example, if your dream home costs IDR 500 million, you’ll need at least IDR 50 million to IDR 100 million for the down payment. Make sure you’ve saved enough before starting the buying process.

Look for financing programs offering down payment relief, such as KPR iB Hijrah, which provides sharia-compliant home loans without riba (interest).

4. Choose the Right Financing Program

Your choice of financing plays a major role in the homeownership process. With various programs available, pick one that aligns with your principles and needs.

One excellent option is KPR iB Hijrah, offering:

Affordable and fixed installments: Choose between tiered or fixed installments throughout the loan term.
Competitive margin rates: Starting at 9% fixed for 5 years.
Special privileges: Loyal customers and Bank Muamalat payroll clients enjoy faster processing and simpler requirements (terms apply).
Flexibility: Financing terms up to 25 years.
Joint income applications: Spouses can combine incomes for loan approval.

5. Set Aside Funds for Additional Costs

Buying a home doesn’t end with paying the down payment or monthly installments. You’ll also need to budget for additional costs, such as:

Minor renovations to suit your preferences.
Furniture and household essentials.
Regular maintenance to keep the property in good condition.

To prepare for these expenses, consider using a Tabungan iB Hijrah Rencana savings account to ensure your budget stays secure. Including these costs in your financial planning helps you avoid unexpected expenses in the future.

Make Your Dream Home a Reality Today!

Owning your dream home is not impossible with careful planning. Start by evaluating your finances, setting clear priorities, and choosing the right financing option, like KPR iB Hijrah. With its transparent sharia-compliant system and customizable installment plans, you can achieve your dream home without financial stress.

Apply for KPR iB Hijrah now and experience the ease of sharia-compliant home financing!