In today’s real estate market, homebuyers are faced with a tough choice between under-construction homes and ready-to-move homes. This decision can greatly impact your forthcoming decisions, budget, experience, and lifestyle. In this article, we will guide you on how to make a decision by understanding the pros and cons of both choices.
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What is an under-construction home?
Under-construction homes are properties that are in the process of being built. These properties are still under process and have not been completed or renovated. It is also known as a pre-construction property. The builders often sell these properties before it is fully constructed, giving them a chance for buyers to customise.
Advantages
- Customisation
One of the biggest advantages of buying an under-construction home is you can customise it in your way. It gives you an opportunity to tailor the living space according to your tastes. Potential buyers often collaborate with the developers or builders to design their under-construction property.
- Cost saving
Under-construction homes often come with budget-friendly price tags. Developers usually offer various discounts and other attractive incentives to seal the deal. This can include giving options like flexible payment plans and making home ownership accessible.
- Potential of investment
When one buys a property during its construction phase, it can yield long-run future gains, and the property’s value may increase, resulting in a higher resale value. This will give the buyer an advantage of gaining a higher value from the house.
- Less competition
Competition for under-construction homes is lower, leading the homebuyer to get the deal in their budget. This allows the buyer more negotiating powers.
- Modern design
Buying an under-construction home allows you to design the home in your own way. This could mean that you can incorporate modern designs and amenities. This can include facilities like smart homes and energy-efficient infrastructure.
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Disadvantages
- Delay
Many factors can contribute to delaying the under-construction properties. These factors can include a shortage of labour, weather conditions, and regulatory issues. These delays can cause hindrances for you moving into your home.
- Uncertainty
The visual outcome of the project can be uncertain. Buyers should rely on architectural plans, designs, and, most importantly, the developer’s reputation. There is a possibility that the final outcome may not meet the expectations of the buyers.
- Limited occupancy
If you are looking for an immediate move into your home, then under-construction homes may not be the right choice. These types of properties require time and patience to develop.
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What are ready-to-move homes?
A ready-to-move home, also known as a completed home and move-in ready home is a fully constructed and finished property for the buyer to purchase. This is for immediate occupancy. These homes require no further renovations and modifications.
Advantages
- Immediate occupancy
Ready-to-move homes’ biggest advantage is that they are perfect for homebuyers who are looking for immediate occupancy and cannot wait for any construction. There is no waiting period, delays, or uncertainty.
- Physical inspection
Since the house is already built and ready, potential homebuyers can inspect the house physically as many times as they want. They can inspect the quality of the materials used, the companies of infrastructure, and the locality. It is like what you see is what you get.
- Construction hassles eliminated
Ready-to-move-in homes, as the name suggests, you no longer need to wait for the construction to finish. You can move in whenever you want. You can be convenient without factors like dust, noise, and ongoing disruptions in construction projects.
- Certainty and transparency
There is a guarantee of quality associated with ready-to-move-in homes. Everything is made transparent in front of the homebuyers by the builders. Potential homebuyers can expect probity from the developers.
- Easier resale
These homes provide the benefit of reselling it easier in the long run. Home buyers usually appreciate the immediate occupancy, and this will lead to a better price for the property.
Disadvantages
- Limited customisation
Ready-to-move homes provide you with the disadvantage of limited customisation. You need to purchase the already-fitted furniture and amenities. Minor renovations can be done, but not the major ones.
- Higher and fixed cost
The price of ready-to-move-in homes is generally higher as the builder has already planned everything for you. This leaves little room for negotiation.
- The potential for hidden issues
If the builder was not honest at the time of selling the home, then you can discover hidden issues in the future, like water leakage, location constraints, and unexpected repair and maintenance costs.
Under-construction vs. ready-to-move homes: How to make a choice?
Several factors should be considered when making a choice between under-construction and ready-to-move homes.
- Budget
When deciding to buy a house, budget is the key factor in influencing the decision. If you have a fixed budget, then under-construction homes give you the opportunity to negotiate. Whereas, read-to-move homes have a fixed price. A budget is required for potential cost overruns, delays, uncertainty, hidden issues, and housing arrangements.
- Timing to move
If you are patient and willing to wait for longer durations, then under-construction homes are perfect for you. If you want an immediate occupancy, then you have the option to consider ready-to-move homes. Construction timelines can be uncertain and often make you longer than intended.
- Risk tolerance
Risk tolerance is also different for both. The risks associated with under-construction homes are quality issues, uncertain delays, and changes in the layout and design of the property. It is important to inspect the track record of the builder from whom you are planning to purchase the property. For ready-to-move homes, the risk is much less. However, a thorough inspection must be done before moving into any type of home.
- Location and amenities
Before moving into any type of home, check for neighbourhood, local amenities provided, and proximity to essential facilities like schools, hospitals, transport, and grocery stores. Move into the home if it aligns with your lifestyle.
- Long-term plans
Long-term plans are important for individual growth, and check how the property aligns with the plans. If all is perfect, then you can consider between under-construction and ready-to-move-in homes.
FAQs
Is it wise to buy under-construction homes?
Purchasing an under-construction home in its initial stages is a wise decision. However, as the construction progresses, the prices also increase.
What does the construction status ready to move mean?
Ready-to-move homes are completed properties and do not require further renovation. You only need to consider your budget and financing options to buy ready-to-move homes.
Can I still make minor changes in ready-to-move homes?
Yes, minor changes can be made in ready-to-move homes. These changes include painting, updating flooring, window treatments, updating fixtures, backsplash installation, minor bathroom upgrades, landscaping and gardening.
What financing options are available for under-construction and ready-to-move homes?
The financing options for under-construction homes include home loans, top-up loans, Construction-Linked Plans (CLP), and Pre-EMI (Equated Monthly Instalment). Whereas the financing options for ready-to-move homes are home loans, resale home loans, Loan Against Property (LAP), and personal loans.
Are there any tax benefits associated with buying an under-construction or ready-to-move home?
Yes, there are tax benefits to buying both under-construction and ready-to-move properties. These include home loan interest deduction, principal repayment deduction, stamp duty and registration charges deduction, and additional deductions for first-time homebuyers.
What should I look for in the locality when considering either option?
When considering either option, look for factors like neighbourhood safety, accessibility, connectivity, schools and educational institutions, healthcare facilities, shopping and entertainment options, water and power supply, noise and pollution levels, and scope for future growth.
How can I ensure a smooth transition when moving into either type of home?
To ensure a smooth transition when moving, things to keep in mind include moving day essentials, supervising the move, checking for utilities and services, deep cleaning after moving, security, and safety.
| Got any questions or point of view on our article? We would love to hear from you. Write to our Editor-in-Chief Jhumur Ghosh at jhumur.ghosh1@housing.com |
