Under-construction projects and ready to move in homes – The changing demand pattern, Who opts for what
February 9th, 2020
Everyone looking to purchase residential property must choose between under-construction projects or apartments that are ready for occupation. Recently, the trend has changed, and ready-to-move-in apartments are witnessing growing demand despite higher pricing.
The Growing Trend towards Purchasing Ready to Move in Homes
One of the first questions which everyone looking to buy a new apartment faces is whether to opt for an under construction or ready-to-move-in apartment. There are benefits and pitfalls to both and choosing between the two depends on your priorities. Homebuyers can generally be classified into two groups based on their priorities – Investors and end-users. Investors prioritize capital appreciation, which they can expect from their purchase, whereas end-users prefer purchasing apartments that offer nice living conditions.
Advantages of Under-Construction Projects
An under-construction project refers to any residential construction which has not received its occupancy certificate. There are several benefits to purchasing an apartment that is still being built. End-users and investors alike seek to purchase such apartments because they are available at significantly cheaper rates than ready-for-occupation apartments.
The difference in margin varies from market to market, but usually, an apartment in a project which is only 50 percent complete can be purchased at a discount of five to ten percent than a ready-for-occupation or resale listing.
Investors are assured of returns on their investments because there is a rise in the price of their apartments as soon as the building is complete. End-users are happy because they can purchase their residence at a discounted rate.
End-users also prefer to purchase under-construction apartments because there is a lure to purchasing an apartment that is brand new and you are the first occupant. Brand new constructions also offer a long-life span, and homeowners don’t have to worry about high maintenance costs and repairs in the near future.
Advantages of Ready-to-Move-in Apartments
Apartments that are ready to be occupied may be costlier, but you can physically inspect these apartments. The buyer does not have to imagine how the apartment will be at a future date. They can see what the apartment looks like and make a more informed decision. Many end-users prefer buying apartments that they can inspect properly and examine every aspect of it.
Furthermore, if you want to live in a desirable area of any city, then buying a resale apartment may be your only option. New constructions in old and developed parts of a city are few and far between. Buyers who want to live in the central parts of the metropolis rather than the outskirts have no option but to opt for resale apartments. These apartments come at a premium cost, but they make up for it with their location.
The Changing Pattern of Demand
Not so long ago, buying apartments in new projects was in vogue. Investors and end-users alike jumped at the chance to purchase real estate at significant discounts, in areas that were developing fast. However, in the last few years, the trend has changed. Since, under construction projects face an uncertain future, the sale of properties that are complete have been increasing in recent years.
Overall, choosing between under-construction or ready-to-move-in apartments depends on your circumstances. There are valid reasons to opt for both, and industry experts are the first to acknowledge the same.