8 rea­sons why should you opt for a ready­to­move­in house

AD­VAN­TAGES Ready­to­move­in houses re­duce chances of get­ting duped, be­sides of­fer­ing a host of other ben­e­fits

Hindustan Times (Chandigarh) - Estates - - FRONT PAGE - Ash­wini Ku­mar Sharma ash­wini.s@htlive.com n

There is nod earth of sup­ply in the res­i­den­tial real es­tate mar­ket across In­dia, both in the ready-to­move-in and un­der-con­struc­tion cat­e­gories, thanks to low sales in the last few years. Ac­cord­ing to a re­port by Li­ases Fo­ras, a Mumbai-based real es­tate rat­ing and re­search firm, at the end of first quar­ter of fi­nan­cial year 2018-19, there were 945,964 un­sold units in 8 tier-I cities in­clud­ing Ahmed abad, Ban­ga­lore, Chen nai, Hy­der­abad, Kolka ta, Mumbai Metropoli­tan re­gion (MMR), Na­tional Cap­i­tal re­gion (NCR) and Pune. More­over, con­sid­er­ing the sales vol­ume dur­ing the quar­ter, it will take 41 months to clear these in­ven­to­ries, said the re­port.

If you are look­ing to buy a prop­erty now, you would get plenty of op­tions. But there is merit in choos­ing a ready-to­move-in prop­erty.


When you buy a ready-to­move-in house, the big­gest risk that you elim­i­nate is project de­lay. You are not re­quired to wait for the com­ple­tion of the apart­ment and other ameni­ties in the project. While the Real Es­tate (Reg­u­la­tion and De­vel­op­ment) Act( RE RA ),2016 has been im­ple­mented and de­vel­op­ers are ex­pected to ad­here to time­lines, most de­vel­op­ers have listed a dead­line of 5-6 years from now on the web­site for their projects. Typ­i­cally, the dead­line that de­vel­op­ers gave ear­lier was for three years. In other words, most de­vel­op­ers have al­ready made pro­vi­sion for project de­lay. Any penalty or com­pen­sa­tion un­der R ERA will get im­ple­mented only when the de­vel­oper does not meet the men­tioned dead­lines.


Un­cer­tainty about space, size of rooms, view from the apart­ment, con­struc­tion qual­ity and avail­able ameni­ties can be elim­i­nated when you buy a ready to-move-in apart­ment. “It is im­por­tant to con­sider the qual­ity of project; a ready-to-move in project al­lows one to closely inspect struc­ture and qual­ity of fin­ish,” said An­shul Jain, coun­try head, Cush­man & Wake­field In­dia.

“The ma­jor ben­e­fit (of buy­ing a com­pleted apart­ment) is that buy­ers are com­pletely aware and know ex­actly what they are buy­ing while in­spect­ing the apart­ment. The de­ci­sion of pur­chas­ing a ready-to-move-in prop­erty is not based on what is shown in a sam­ple flat or on mere lay­outs,” said Ramesh Nair, CEO and coun­try head, JLL In­dia.


It is es­sen­tial to know your neighb our hood and the avail­able in­fra­struc­ture around the area such as nearby mar­kets, com­mon pub­lic ar­eas and parks, con­nec­tiv­ity is­sues, among oth­ers .“A build­ing of­fer­ing ameni­ties, se­cu­rity, a good neigh­bour­hood and so­cial in­fra­struc­ture in the vicin­ity tends to work bet­ter for buy­ers,” said Nair.


You can start liv­ing in a ready-to­move-in house as soon as you buy it. “For those with an im­me­di­ate re­quire­ment who are un­able to af­ford both rent and EMIs, a ready-to-move-in home works well,” said Jain. Even those who can de­lay mov­ing to their own house by a few months or years can never be sure about the time­line as the pos­ses­sion will be de­pen­dent on whether the de­vel­oper is able to ex­e­cute the project on time—or worse—at all. For in­stance, home buy­ers in projects of Jay pee Group, Unite ch Group and Am­ra­pali Group, builders that are fac­ing in­sol­vency pro­ceed­ings, have been left in the lurch.


If you do not want to move into the house your are buy­ing and are plan­ning to buy it for in­vest­ment pur­poses, you can start earn­ing ren­tals as soon as you buy a ready-to-move-in prop­erty.

Ren­tals can help you pay some part of the EMI if you have taken a loan and en­hance your re­turns. “It is also ad­vis­able to study the pric­ing and rental yield trends in the lo­ca­tion and check for any up­com­ing in­fra­struc­ture in the vicin­ity to gauge pos­si­ble cap­i­tal ap­pre­ci­a­tion in the fu­ture,” said Nair.


GST of 12% is ap­pli­ca­ble on an un­der-con­struc­tion prop­erty. It is charged over and above the prop­erty value. So if you are buy­ing an un­der-con­struc­tion prop­erty valu­ing ₹60 lakh , you will have to pay ₹7.2 lakh as GST. “Cur­rently, no GST is ap­pli­ca­ble (on ready-to-move-in prop­erty) which re­duces the over­all fi­nan­cial out­flow,” said Jain.


Ac­cord­ing to the In­come tax Act, 1961, a bor­rower can claim de duc- tion un­der Sec­tion 80C against prin­ci­pal re­pay­ment of a home loan, which has an over­all limit of ₹1.5 lakh and up to ₹2 lakh for pay­ment of in­ter­est un­der Sec­tion 24(b) for a self-ac­quired house.

How­ever, there is a catch; these tax ben­e­fits can only be claimed af­ter the con­struc­tion of the prop­erty is com­plete and you get the reg­is­tra­tion and own­er­ship doc­u­ments. So, no pos­ses­sion means no tax ben­e­fit against home loan re­pay­ment. You are al­lowed to claim de­duc­tion on the in­ter­est paid on a home loan dur­ing the con­struc­tion phase in five equal in­stal­ments post pos­ses­sion. If the con­struc­tion gets de­layed and takes more than five years, the max­i­mum de­duc­tion al­lowed on in­ter­est pay­ment re­duces to ₹30,000 in­stead of ₹2 lakh per an­num. More­over, the prin­ci­pal amount re­paid dur­ing con­struc­tion is not al­lowed for de­duc­tion at all.


It is dif­fi­cult to sell an un­der-con­struc­tion prop­erty, es­pe­cially if its de­liv­ery is de­layed or it’s locked in a le­gal bat­tle. In many cases, de­vel­op­ers do not al­low the trans­fer of apart­ments un­til the project is com­plete. Even if they do, you may have to pay hefty trans­fer charges in the range of ₹200-500 per sq.ft or more, which can dent your gain. Though there are ben­e­fits of buy­ing a ready-to­move-in apart­ment ,“they( home buy­ers) might have to shell out a lit­tle more on such pur­chases com­pared to un­der-con­struc­tion ones,” said Jain. How­ever, whether you buy an un­der-con­struc­tion or ready-to-move-in prop­erty, be sure to do your due dili­gence re­gard­ing the qual­ity of con­struc­tion, lo­ca­tion and sur­round­ing in­fra­struc­ture.


When you buy a ready­to­move­in house, the big­gest risk that you elim­i­nate is project de­lay n

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