‘Costliest trap’: Financial advisor decodes why early homeownership drains 30-50% of income

Buying a home is widely celebrated as a defining milestone of financial success in India — a rite of passage signalling stability, adulthood and status. But Chartered Accountant Nitin Kaushik argues that for many families, it quietly becomes “the costliest trap of their lives.”

In a detailed post on X, Kaushik challenged the deeply entrenched belief that homeownership is always a smart financial decision, highlighting the mismatch between emotion, timing and math.

In a detailed thread on X (formally twitter), Kaushik challenged the conventional wisdom that equates owning a home with security and success. “Owning a house is widely celebrated as the ultimate financial milestone. But for many, it quietly becomes the costliest trap of their lives,” he wrote, urging young earners to rethink the timing and motivation behind their first property purchase. 

‘A self-occupied home behaves differently’ 

According to Kaushik, a self-occupied home offers emotional comfort but drains finances steadily. It does not pay rent to the owner but instead “demands money every month — loan interest, repairs, maintenance, society charges, property tax, upgrades.” 

He argued that the real EMI is far more than the monthly bank slip — once these costs are added, households often see 30-50% of their annual income tied up in keeping the home running. This, he warned, can turn an aspirational asset into a long-term financial burden. 

When an ‘asset’ becomes a pressure point 

Kaushik emphasised how vulnerable households become when their income flow is disrupted. “One job loss. One bad year. One medical emergency. The entire financial structure shakes, because the house owns the person, not vice versa,” he wrote. 

He added that while homeowners like to call it “equity,” banks simply view it as “collateral” — a subtle but consequential difference when stress hits. 

Property appreciation vs Capital lock-in 

While acknowledging that real estate appreciates — 4-6% annually on average, with some metros and Tier-II cities touching 10-19% recently in premium pockets — Kaushik said this does not always justify early aggressive buying. 

During their prime earning years, many buyers devote nearly half their salary to EMIs, leaving little room to build diversified portfolios. “Wealth grows when money moves freely. A house locks up capital for decades,” he noted. 

‘Most don’t buy because the math works’ 

Kaushik highlighted how societal expectations often override financial logic. “Parents want stability. Relatives want status. Neighbours want comparison,” he wrote, adding that the decision shifts from financial analysis to emotional validation. 

Challenging long-held stigma, Kaushik argued that renting offers mobility — the ability to shift cities, chase better opportunities, or pivot careers without the anchor of EMIs. 

“Ownership grounds roots. Renting builds opportunities. Both have value, depending on life stage,” he said. 

How serious wealth builders approach it 

According to Kaushik, financially savvy individuals first focus on building cash flows — through SIPs, REITs, businesses, and commercial assets — before buying a home out of choice rather than pressure. 

“A house is not the villain. Buying too early, emotionally, or aggressively can suffocate growth,” he wrote. 

Kaushik ended his post with a reminder that security lies not in property ownership alone but in income resilience. “Cash flow protects. A house comforts. Choose order carefully.”