If you’re on the fence about buying a resale flat or property, then we’ll tell you why it makes sense to do so. Read all about it in this article.
Arjun was tired of shifting flats due to the ever-increasing rental rates in Delhi so he decided to invest his money in purchasing a resale flat. In addition to a hefty discount, the flat came ready made with an instant-shift tag. Arjun can now spend the saved money on the interiors and can flaunt his cheap yet elegant home to his colleagues.
Rather than waiting endlessly for real estate prices to fall or being taken in by developers, a money-conscious person looks for options that offer a good solution. A resale flat could be as good as new and can be obtained at a discount of no less than 10% of the price of a newly constructed one. However, does the cost saving alone make resale flats an economical alternative to brand new one?
Additional Reading: Should I Buy A House Or Continue Staying On Rent?
How prices vary
Prices for resale flats can vary depending upon a number of factors like the city, locality, brand name of the construction company, age of the flat, etc. Often, the price of your property is valued based on its surroundings. For instance, property prices are higher if they are closer to developed areas. And development could mean good infrastructure, good roads, safe locality, access to good schools, hospitals, airports, railway station, bus stops etc. So, property prices are dependent on other factors too apart from the age of construction, builder and brand name.
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Benefits of getting a resale flat
Getting your hands on a resale property is also beneficial in several ways:
- The resale market provides a ray of hope to the income-conscious individual by offering flats at a cheaper rate.
- A resale property also comes with the benefit of being in a better location and at a comparatively lower cost. You may not always be able to afford properties that come up in newer locales.
- If you’re uncertain about living in a particular city, a resale property will work best as it would be easy on your pocket.
- Purchasing a resale and ready-to-shift into flat helps save a good amount of money that would otherwise have been spent paying both EMIs and rent as would be required in the case of an under-construction dwelling.
- There are no cloaked features in this market. What you see is what you get.
Additional Reading: Why An Under-construction Property Is A Good Idea
Some grey areas and pitfalls
There are some areas that need attention when purchasing a flat in the resale market:
- Checking the documentation carefully is the first and most important thing to do.
- It is essential to check whether the seller is the true owner of the property.
- The buyer must also ensure that the seller doesn’t owe any dues to the society, building or against the house.
- It is imperative to check the physical condition of the flat before investing your hard-earned money into it.
Additional Reading: 5 Extremely Important Things To Keep In Mind When Buying Resale Property
What if the flat is mortgaged?
If the flat is mortgaged to a bank, the owner needs to procure a document from the bank affirming that it agrees to give the documents to the buyer upon the full payment of the loan. As soon as you transfer the money to the seller’s account, whether in cash or through a Home Loan, the bank will release the original documents immediately, along with a no-dues certificate.
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How to Choose
There are certain essentials that make the selection process an easy and productive one.
- The age of the property should ideally range between 1 to 5 years to a maximum of 10 years.
- Know about the reputation of the builder and the quality factor associated with his past developments.
- Understanding the reason behind the sale will help with uncovering any problems and issues with the property any.
- Consider the surrounding environment, proximity to important areas and amenities available in the vicinity before making the decision to purchase a resale flat.
Additional Reading: How To Evaluate A Property And Builder Before Buying A House
Nothing can be more profitable than purchasing a flat at a price much lower than the market rate. Moreover, resale flats are fully-constructed and come with a ready-to-move-in tag. Like all other properties that have been purchased with a loan, resale flats too give you tax benefits. A deduction of Rs. 1.5 lakh on the principal portion of your Home Loan EMI under Section 80C of the Income Tax Act and a tax exemption of up to Rs. 2 lakhs on the interest component under Section 24B make this purchase all the more profitable.
Hence, if all the other factors work in your favour, it might be a good idea to invest in a resale flat. It helps save a good amount of money, while saving time otherwise spent waiting endlessly for a new project to be completed.
Additional Reading: 12 Amazing Tips To Save Money When Moving Into Your Dream House
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When it comes to the matter of buying or re-selling the flats, many people will face dilemma and fail to take final decision. But, reselling the flats is also a good option, where one can get max. 10% discount of the price. However, everything depends on the price because one must focus on its fluctuations in the market. Don’t forget other points such as age of the property, why owner is going to sale it, proximity to other major areas, etc. In fact, both buying or reselling the flats both have their own advantages and disadvantages. Think wise and act.
Nicely explained all the points..
Hi Akshata, We’re glad that you liked our article. And thanks for sharing your opinion. Keep reading and sharing! Cheers, Team BankBazaar