Buying a home is a significant investment, and choosing the right property type is crucial. Going for an under-construction property or a ready-to-move-in apartment can often overwhelm homebuyers.
If you, too, have been stuck in this loop, don't worry. We're here to help you choose whether to go for a ready-to-move-in apartment or under-construction property.
So let's get started on your home-buying journey!
Points to Consider While Choosing a Ready-to-Move-in Property
#1 Locality
A prime spot guarantees a great return on investment, as you can always renovate the interior, but you can't change its location. Seek out a property near all the amenities to ensure happy tenants with easy access to everything they need.
#2 Neighbourhood
When choosing a move-in-ready apartment, don't forget to explore the neighbourhood. Chat with locals for their insights on the building and the area. Safety and liveliness are key factors in selecting the perfect spot. Avoid developers who promise the world with vague plans and inflated prices.
#3 Legal check of flats
As a homebuyer, don't compromise on the aesthetics or legality of your dream flat. Verify if the developer has obtained approvals and NOCs from Municipal Corporations and other authorities. Conduct due diligence and ensure your investment is legally sound with proper documentation.
Points to Consider While Choosing an Under-Construction Property
#1 Verify the documents
Before investing your hard-earned money, get a clear picture of the legal status of the property. Check basic details like if it's registered under RERA (Real Estate Regulatory Authority) and has environmental clearance.
#2 Financial situation and credibility
Before making a property purchase, ensure that the builder is financially stable. Avoid developers who have been in trouble with previous projects and have multiple consumer complaints. Also, consider how long the builder has been in business.
#3 Check if the site is applicable to home loans
If you plan to buy an under-construction property on loan, opting for projects with the bank's approval is best. This way, the bank can thoroughly evaluate the project and get details about the developer before sanctioning the loan.
Ready-to-Move-in Versus an Under-Construction Property
The table represented below gives an in-depth comparison of ready-to-move-in property and an under-construction property.
Parameter
Ready-to-move-in apartment
Under-construction property
Discount and offers
Since it's ready to move into an apartment, you need to pay the cost as per the market and even more depending on the amenities.
In an under-construction project, several discounts and freebies are offered, such as free car parking.
Ease of selling
After a few months or years, you can sell ready-to-move-in properties.
If, for some reason, possession is delayed, it can be challenging to sell an under-construction property.
EMIs
For ready-to-move-in property, you'll have to pay EMIs on the home loan and would include no other payments.
For an under-construction property, EMI begins after the completion of construction work.
Age of property
It could be a negative factor if the ready-to-move property were not occupied for several years.
It's not a concern if you possess the newly constructed property. This gives solid ground for future ROI.
RERA
Old ready-to-move-in flats with an Occupancy Certificate as of 1st May 2016 have not been included under RERA.
With RERA in place, developers must deliver on time, and if they don't, they are responsible for compensation to you.
Payment
Since the ready-move-in units have completed the construction stages, you must have ready finances.
For under-construction properties, you'll have more time to make payments as the project has many construction stages of completion.
Property costs
It's usually expensive because the physical infrastructure is already developed.
It’s relatively cheaper.
Level of risk
The property can be sold to multiple buyers. Therefore, prioritize due diligence.
Under-construction properties are easier to buy. Due diligence is still essential.
Transparency
For a ready-to-move-in apartment, you get what you see.
Under-construction homes may differ from the finished product in design or features.
GST
It's not applicable to a ready-to-move-in apartment.
The GST for under-construction affordable housing units is 1%, while for non-affordable projects, it’s 5%.
Disbursement of the Home Loan - The Process
If you wish to purchase a ready-to-move-in or under-construction home, you may apply for a home loan. Here’s what the disbursement process of a home loan looks
like.
Step 1: Fill out an application form online. Fill in your details.
Step 2: Upload the required self-attested home loan documents.
Step 3: Lender will verify your documents.
Step 4: Lender will do a thorough inspection of your property.
Step 5: Once satisfied, the lender will approve your home loan.
Step 6: The sanctioned home loan amount will be disbursed to your account within 3 to 5 working days.
Over to You
Ready to buy a property? Whether it's under construction or ready to move in, Tata Capital's got you covered. We offer home loan with competitive home loan rates and charges.
With our easy-to-use home loan EMI calculator, you can also determine your eligibility and monthly repayments beforehand, making your home-buying journey a breeze! Apply now!
31 March 2023
5 mins read
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