You would have heard stories of people buying units when they were still in construction and then witnessing a 2x growth in a matter of months.
Similarly, you would have also seen news of people not getting possession of their property and getting a majority of their wealth stuck for years.
Ready-to-Move Properties or Still in Construction. That’s what we will try to cover today:
At what stage should you consider purchasing an apartment?
- Should you book the flat at the initial stage, when the builder has launched the project?
- Should you only put your money when it is completely ready?
To get an answer to these important doubts, you should be absolutely clear about:
Whether or not you are going to get possession of your flat TIMELY?
And THIS will depend on your contract terms.
My personal experience has helped me learn:
[1] Be absolutely clear on whether you will get possession of the property in a timely manner.
Read the contract carefully. Be clear about what you are buying.
[2] When it comes to Real Estate, be clear about the type of property.
Not the showcase, not the sample flats with stellar interiors - but the end product with no fancy lights.
[3] Price Increase
Yes, the price increases after the flat's completion or near-completion stages. You can get a lot of gain by pre-buying it.
But you should only do it if you can 100% know that the project will be complete.
There are numerous cases where projects are left incomplete, and retailer's money is blocked in such deals.
Case Study
According to a report by Anorak in 2022, as many as 500,000 homes worth Rs 4.48 lakh crore are stuck across seven micro markets in the country.
They further mentioned that:
- The National Capital Region (NCR) and Mumbai Metropolitan Region (MMR) together account for 77 percent of such projects.
- Pune had a 9 percent share of delayed projects, and Kolkata 5 percent.
- The southern metros of Bengaluru, Chennai, and Hyderabad together accounted for the remaining 9 percent.
- NCR has approximately 240,610 stuck or delayed units worth over Rs 1.81 lakh crore.
- MMR comes next with 128,870 units worth about Rs 1.84 lakh crore.
- Bengaluru has 26,030 units worth over Rs 28,072 crore that are running behind schedule.
- Hyderabad has some 11,450 such units worth over Rs 11,310 crore, while
- Chennai has the fewest stuck homes among the top seven cities, with 5,190 units worth around Rs 3,731 crore.
These are some of the projects that were delayed:
Link to more such projects:
https://www.moneycontrol.com/news/indias-most-delayed-residential-projects/
There are even cases of defects:
We will take a deeper look at such scams in the following newsletters.
The idea is not to scare you but to remind you that you need to protect your downside risk.
Ideally, I prefer to buy the property when it is near completion and when I am certain about my end product.
This is my perspective. The opinions can certainly differ from person to person.
It's up to you to learn and make an informed decision.
Source
- Akshat Shrivastava 15/30 days Newsletter.
