While making a real estate investment, buyers frequently need help to choose between an under-construction and ready-to-move-in project. Though both are available, people frequently hesitate to invest in under-construction properties because of the lengthy construction periods. Before investing your hard-earned money in a property still under construction, find the answers to the five crucial questions you should have asked the builder by reading on.
Under-construction properties are highly appealing to investors and end users due to their relatively lower prices when compared to ready-to-move-in units. Purchasing an under-construction unit can also allow you to select the preferred Vastu direction of the unit, the flooring, and, in certain situations, the floor. An under-construction property does, however, come with some drawbacks. Although Godrej Properties Limited, a Grade A developer, completes projects on time, the nation’s real estate market is chock-full of postponed under-construction projects. With that in mind, this piece aims to equip purchasers with a few essential inquiries to ask if purchasing a property that is still under construction.
Industry experts feel that as long as due diligence occurs, buyers should not let the risk associated with any investment prevent them from purchasing an under-construction property. Furthermore, buyers now find it easier to select reliable developers and projects thanks to the Real Estate (Regulation and Development) Act (RERA) 2016. Customers feel more confident about purchasing real estate now that the RERA has emerged. From the project’s current phase to the permissions obtained or pending by the developer, every detail about the project is available on each state’s RERA website. The innovative legislation’s penalty provisions protect purchasers from construction delays and subpar work.
To what extent has your project gained recognition since its inception?
There are effects between a real estate project and its surrounding area. For this reason, choosing whether to invest in an appreciating or depreciating project is essential. It also applies to the project’s surrounding area. To put it in perspective, the homebuying values of Godrej Hillside, an unfinished residential project in Mahalunge, Pune, have increased by more than 50% during the past three years. Over the same period, Mahalunge’s real estate prices have increased by more than 20%. Godrej Hillside anticipates raising prices to complete several units beginning in October 2024. Investing in such a project yields a positive Return on Investment (ROI) for the buyer. You have to ask the builder this kind of question to ascertain the performance of your investment.
How many units in the project have sold out?
Even though a builder is more likely to provide an exaggerated response, it is still crucial to ask this question. The investigation is necessary since sluggish sales could indicate issues with the specific project. Asking the builder how many inquiries they receive in a week or month can also help you gain a better understanding. A reasonable exception for the conversion should be one or two percent of the quoted amount. Real estate experts caution against adopting a herd mentality when making investments. It is advisable to carefully examine the project, investigate the neighborhood, verify the project’s RERA registration status, and get a sense of the builder’s popularity by speaking with previous purchasers.
What is the total number of units sold in the project?
Even though a builder is more likely to provide an exaggerated response, it is still crucial to ask this question. Investigating sluggish sales is essential as it could indicate issues with the specific project. Asking the builder how many inquiries they receive in a week or month can also help you gain a better understanding. A reasonable expectation for the conversion should be one or two percent of the quoted amount. Nevertheless, you should not copy a project because other buyers flock to it. Real estate experts caution against adopting a herd mentality when making investments.
It is advisable to carefully examine the project, investigate the neighborhood, verify the project’s RERA registration status, and get a sense of the builder’s popularity by speaking with previous purchasers.
Can you tell us more about your prior projects?
Verifying a builder’s history is extremely important. If the builder has completed projects on time and with structural integrity, you can expect the pattern to continue. Developers like Godrej Properties can build a solid reputation by meeting the needs of their customers with well-executed projects on schedule.
Which commercial rights in the project will you keep?
Developers typically maintain a commercial stake in a project long after it ends and ownership passes on. When buyers learn that the builder has kept some rights, like the clubhouse, and has only shared membership with them, they frequently feel duped and let down. It is best to talk about this with the builder and get it included in the agreement before you sign on the dotted line.
Even though investing in a project still under construction may seem intimidating, there are benefits, such as being somewhat more affordable initially, offering better returns over time, and offering more customization options. However, it is advisable to invest in a project accredited with the RERA, use a property portal, and consider any future developments in the neighborhood before finalizing the deal–as with any real estate transaction. However, it is advisable to invest in a project accredited with the RERA, use a property portal, and consider any future developments in the neighborhood before finalizing the deal –as with any real estate transaction.