Experts feel that new projects are usually launched at attractive prices and discounts than predominant market rates, with a view towards attracting more investors and buyers. However, it is also dependent on how soon buyers wish to move into a property. Purchasing an under construction property only works for those buyers who are not in a tearing hurry to shift as per Indrajit Sidhanta, the Principal Partner and Head of Business Development at Square Yards, India’s foremost property technology platform. He added that launch rates of properties are considerably lower than homes which have moved past the early construction stage.
Other experts feel that payment plans are more flexible and attractive for new launches with lower amounts needed initially. Developers usually require 5% of the value as booking amounts while requiring 10-25% in 3-12 months. The remainder is then required with the progress in construction throughout 3-4 years. 5-10% of the value is payable when you take possession. Ready to move units will require full payment in 2-3 months in comparison. Buyers also get more choices with under construction properties unlike resale or secondary properties. Sidhanta also feels that early-bird buyers may select their preferred units in projects on the basis of Vaastu and also opt for more customization in sync with their own design aesthetics. Some developers may accommodate requests from buyers including upgrades on bath fittings, additional kitchen slabs and more at nominal costs.
He also opined that the biggest hurdle for buyers in this segment is a construction delay. Failure to get approvals on time, funding problems and legal cases may lead to such delays. Newly launched projects usually need multiple approvals from authorities which require sizable time and projects may be canceled without the same or if developers do not have the financial strength to commence the same as per Sidhanta. He also stated that developers may at times unnecessarily delay their projects if market conditions are not conducive.
Other issues include deviation in the plan for construction in some cases and limited options with regard to exits. Buyers find it hard to exit in the period of construction, especially if the developer has unsold inventory and sales figures are on the lower side. You may have to fork out transfer charges for premature exits as well. Buyers should only choose developers with proper track records or invest in ready to move properties or projects which are 75% done. Checking RERA sites and cross-checking all other details are also recommended by experts.
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Published Date: Dec, 21 2021
