Pros & Cons of Under Construction Property vs Ready to Move Property
Investment in real estate can be a lifetime decision. So, it needs careful planning and consideration. While navigating the real estate market, real estate investors and buyers usually come across two options i.e. under-construction properties and ready-to-move properties.
These two property types offer unique purposes and intents with diverse tax implications. So, it is essential to know their benefits and drawbacks. The corresponding knowledge helps you to choose the most suitable type of luxury properties. Before understanding the pros and cons of each, let’s first get brief overviews of each of them:
Under-Construction Properties:
For buying under-construction properties, a buyer pays the amount to the builder in different stages of construction. Firstly, the booking charges are paid and then the payments are made in multiple installments according to the agreement with the developer/builder.
Commonly, these types of properties are renowned for their payment flexibility, cost-effectiveness, and decent property price appreciation. These aspects are important to consider if you want to buy this kind of property for sale in Gurgaon.
Ready To Move Properties:
Ready-to-move properties are properties that are already built and available for instant occupancy. You obtain the property that you actually see. These ready-to-move-in apartments provide transparency on what you would get in the deal. If you are thinking of buying ready-to-move property, you must note that these properties are costly.
Now let’s get into the pros and cons of each of these property types:
Pros of Under-Construction Properties:
Here are the advantages of the under-construction properties:
i. Comparatively cheaper costs:
Usually, under-construction property costs 10-15% less than ready-to-move-in properties. Also, it is easy to manage the finances because you have a significant amount of time. If you want to buy property in Gurgaon, you get various options on the unit’s location at a lower price.
ii. Payment Flexibility:
Buying a real estate property in the under-construction phase permits you to pay in multiple installments. Several banks provide home loans in the disbursed format so that the interests are levied only on the amount dispensed in the relevant stage of construction.
iii. RERA compliance:
All the under-construction projects fall under the latest RERA guidelines. So, these properties are compliant with the legal customs in the transactions.
Cons of Under-Construction Properties:
Let’s go through the disadvantages of the under-construction properties:
i. Taxes:
For the under-construction projects, 5% GST of the property’s total cost is applicable. On the other hand, for ready-to-move properties, no tax is applicable.
ii. No instant possession:
Based on the project’s timeline, you need to wait for the construction to finish. It can take several months or years.
iii. Delays and uncertainty:
Usually, under-construction properties encounter delays due to factors like labor issues, weather conditions, or regulatory obstacles.
Pros of Ready-to-Move Properties:
Let’s understand the advantages of ready to move property:
i. Instant availability:
One of the prominent benefits of investing in a ready-to-move property is homebuyers can have instant possession. They need to make the payment, undergo the documentation work and finally move in. Consequently, it saves them from the burden of paying the Equated Monthly Instalments (EMI) (if it’s a home loan) and rent simultaneously.
ii. You obtain what you see
Homebuyers can actually see the final finished product and get what they paid for. The unit is ready to evaluate before finalizing the purchase. Hence, there are fewer chances of discrepancies with the agreed layout, amenities, and features.
iii. Rental income:
Investing in a ready-to-move property helps you to immediately start earning rental income.
Cons of Ready-to-Move Properties:
Let’s go through the disadvantages of ready to move property.
i. Higher costs:
Typically, ready-to-move properties are available at premium prices due to their instant availability and the convenience provided.
ii. Unverifiable construction quality:
In the case of an under-construction property, you can check the construction quality and the work progress. However, in the case of ready-to-move property in Gurgaon, you can’t verify the materials used, structural integrity, and the foundation’s strength.
Conclusion:
The choice between ready-to-move property vs. under-construction property ultimately comes down to the investment goals, preferences, and budget. Ready-to-move properties allow immediate possession and provide convenience but at a higher cost. Contrastingly, under-construction properties offer potential capital appreciation and customization options but they involve delays and uncertainties.