Under-construction or ready home? All You need to know before investing
For high-net-worth individuals, investing in luxury real estate goes beyond financial returns—it's often a lifestyle decision. One of the most common dilemmas faced by buyers today is whether to invest in an under-construction luxury home or opt for a ready-to-move-in property. Each option offers unique advantages and challenges, influenced by factors like timeline, risk tolerance, and long-term goals.India Today spoke with Naveen Yadav, Founder of Navraj Group, to understand how today's luxury buyers are navigating this choice.advertisementTIMELINE FOR POSSESSIONThe most immediate difference between the two options is the timeline. Ready-to-move-in homes are ideal for buyers who want immediate possession, whether for personal use or to start generating rental income. In contrast, under-construction properties typically come with a 2–4-year wait time, making them suitable for investors willing to be patient in hopes of long-term capital appreciation.PRICE ADVANTAGE IN UNDER-CONSTRUCTION HOMES
Under-construction luxury homes are generally priced lower than completed ones in the same location. Developers often offer pre-launch or early-bird rates to attract buyers at the initial stages. While these prices can offer a significant entry-point advantage, they also come with a waiting period and carry construction-related uncertainties.RISK FACTORS TO CONSIDERReady-to-move-in homes provide a higher degree of transparency—you can see what you're buying, assess the quality, and be sure of the timeline. Under-construction properties, however, carry more variables. The credibility of the developer, market fluctuations, and possible project delays can all impact the outcome. Though these homes may offer better returns, they demand a higher risk appetite.RENTAL INCOME OPPORTUNITIESadvertisementFor investors looking to earn rental income quickly, completed homes are the more practical option. These properties are in demand among diplomats, expats, and corporate professionals, particularly in high-end areas. In contrast, under-construction homes do not yield any rental income during the building phase, which may affect cash flow expectations.TAXATION AND GST IMPLICATIONSTax considerations also play a role. Ready-to-move-in properties are exempt from the Goods and Services Tax (GST), which reduces the overall cost for the buyer. Under-construction homes, on the other hand, are subject to GST, raising the purchase price slightly. However, this may be offset by the initial price advantage and potential future appreciation.LOCATION POTENTIAL AND MARKET GROWTHUnder-construction projects in emerging or fast-developing neighbourhoods can offer significant capital gains over time, especially as the area's infrastructure and amenities improve. However, such investments require market research and long-term vision. Ready-to-move-in homes in established localities offer stability and immediate convenience, but their appreciation may be slower given that the neighbourhood is already mature.Choosing between an under-construction and a ready-to-move-in luxury home ultimately comes down to aligning your investment with your personal goals, risk tolerance, and time horizon. Both options have the potential to be excellent investments when chosen wisely. As Naveen Yadav points out, making an informed decision rooted in market insight and financial clarity is the key to unlocking long-term value in luxury real estate.- Ends
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