Having options is great! But what if you get bombarded with numerous options that investing seems like a labyrinth?
That’s the situation of the Indian real estate industry in 2024.
With increasing financial awareness and information subtly available on our fingertips, it's natural to be confused about what type of property one should invest in.
Should it be ready to move into the property?
Or a property that’s under construction.
Honestly, there’s no straight and right answer to this. But, with the right knowledge, you can choose what suits you the best.
Hence, let’s weigh the pros and cons of both these types of properties so you have the best alternative!
As the name goes, ready-to-move properties are those that are already completed, and possessions are given to investors. You can simply buy such property and move in as soon as you want or put them for rental income.
By the way, did you check these top developments in Thane? Check them out here!
On the other hand, properties that are yet to be constructed or are ongoing construction are known as under-construction properties. These properties have a possession data set by the developer, and possessions are made once the construction is complete. However, it is also important to note that there are different phases of under-construction properties, and each of them has their own likes and dislikes.
If you are a real estate investor in Pune, Noida, Thane, or any region that has a growing real estate market, there are many properties that are currently ready to move.
As such, here are some of the advantages and disadvantages of ready-to-move properties in India.
Advantages | Disadvantages |
Your property is instantly accessible, and you can move right after completing the transaction and the required documentation. | Cost of the property is generally quite higher since most of the ready-to-move properties are available for resale. |
Ready-to-move-in properties allow you to check the quality and everything you get firsthand before buying. Hence, you get what you see. | Construction quality of a real estate property degrades over time. If you purchase a ready to move property you will not be able to check the construction quality, the material used, and other details. |
Real-time reviews of property, location, and after-sales services are available through residents already residing, which helps you to make better purchasing decisions. | Properties constructed before May 2016 were exempted from RERA. Therefore, there is no governing body responsible for securing buyer interests. |
Ready-to-move-in properties are exempted from GST which means you do not have to pay the additional GST while buying the property. | Lesser price appreciation in the long term compared to under-construction properties. |
Learn more tax hacks to maximise your real estate savings!
You have ample reason to invest in a ready-to-move property in India. However, from an investment perspective such properties might not meet your long-term goals of producing high capital gain.
On the other hand, if you have ample cash in hand to not take the financial burden onto yourself, ready-to-move-in properties could be a decent match for you. Then again, as said earlier, it depends on what your requirements and objectives are as an investor.
From an investor’s perspective, if you are looking forward to booking a high return on your investment, an under-construction property would be an economical option.
Under-construction properties are often priced 10-30% lower than ready-to-move-in properties. However, it's not just the affordability that plays a significant role. Mentioned below is a detailed overview of both their pros and cons.
Advantages | Disadvantages |
The newer the property, the lesser the price. For example, a pre-launch price is much lower than a launch price, or a project that's just begun its development is priced less than what it would be if the possession date is under a year. | Under-construction properties do have a risk of non-completion and non-delivery of projects due to external factors. Though RERA guidelines safeguard investors in such scenarios, it still affects an investor's overall experience in real estate negatively. |
Scope for price appreciation in the future is much higher since under-construction properties get much resale value once delivered. | Your finished or handovered project may or may not be as you thought it would be or initially promised during booking. |
Payment plans & options are quite flexible and provide great offers in terms of options. | Only ready-to-move-in properties are eligible for tax benefits. Till the time you get your possession, your property (mostly residential) will not be able to claim any tax benefit. |
Under-construction properties are RERA-approved, which ensures both buyer and seller interest. | Under-construction properties are subject to GST application. Under construction affordable properties under ₹45 Lakhs attract a flat 1% GST and anything over that is subject to 5% GST on the property's cost. |
Taking all the factors responsible for a real estate project to be a success like location, amenities, size, and connectivity, one can conclude that under-construction properties are less expensive than a ready-to-move property in India.
Every investment type has its own pros and cons. It's important for investors to know what works best for them based on their long-term goals and requirements.
However, it all starts with the right knowledge and mostly on the first step you take. And, you can do so by getting in touch with our team. One right step and your journey to owning your dream property in India will be true!
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