December 05, 2019 | By Times Of India
Of all the things people ever dream of, having the key to their very own home is most supreme. There are so many sentiments attached to buying a house and turning it into a home. This feeling echoes across the globe and is evident in the surge in the home-purchase numbers.
In China, nearly 70% of millennials are homeowners, while about 91% planned to buy a home in the next five years. In the US, 5.34 million existing homes were sold in 2018. Of which 667,000 were newly constructed. The search for ‘furnished homes for sale’ in the UK went up by 51% in 2017, according to a property portal. The global real estate market continues to grow with people across the world who are inclined towards investing in ready-to-move-in homes.
Toeing this global trend, 84% of Indian homebuyers have also shown their inclinations towards ready-to-move-in (RTMI) homes, as per one research report.
While pan India, RTMI properties have grabbed maximum eyeballs, in Mumbai, too, the buyers are returning to this category. An Anarock report states that time taken to sell unsold flats and houses has dropped substantially in Mumbai. This reduction was observed between 2017 and the mid-2019. As of October 2019, 21000 unsold ready to move in homes were available in Mumbai.
But what is a ready-to-move-in property? An RTMI home is a house or a property that is available for immediate occupancy. A home belonging to this category must meet all the requirements established by the city council or the governing municipality, which includes operable plumbing, electricity, secure doors and windows, and passing certain pest inspections.
Meanwhile, an under-construction property refers to a building that is unfinished but is still being worked on. Every time Indians contemplate buying a home, choosing between an under- construction and an RTMI property continue to cloud their minds with doubt.
We list down the reasons that what really makes a ready-to-move-in home tick. Here are some factors that work in this category’s favour:
1.No GST tax
RTMI homes help mitigate risks associated with new projects including incessant delays, unscrupulous activities of few developers, etc. But the biggest benefit for home buyers is that ready units do not attract the GST. 5% GST is applicable on under-construction properties. But when people buy a ready-to-move-in home, they don’t have to pay any GST, once the completion certificate has been issued. This is a significant pro that protects the interest of the homeowners and gives them added financial relief.
2.People pay for what they see
Consumers get what they are paying for. They can inspect the property before making the final purchase, leaving no room for any discrepancy. The purchase decision isn’t based on a layout or a sample flat. Instead, there are official documentation and paperwork like OC (Occupation Certificate), that govern the buying decision. The chance of getting duped is way lower in RTMI properties, as buying decision can be based on real experience, this is not the case with Under construction properties, because the decision will be pegged on projections.
3.Loan processes are easier and quicker
When people choose a move-in ready home, they have to pay only their EMIs with immediate effect without any other payment. Getting a loan also becomes easier with RTMI properties when the builder is registered with the banks and has a trustworthy reputation. What further makes this an easy task is, when the documentation is in place. People need to have their sale deed, completion certificate, occupation certificate, building plan, encumbrance certificate, and mutation certificate in place. When it comes to under-construction properties, the documentation is a lot more extensive. This includes a detailed KYC of the consumer, NOC from the builder, letter from the builder or architect outlining the construction progress, agreement with the builder duly stamped and registered, sale deed, khata certificate/khata extract. If the property has not been registered, the documentation also encompasses true copy of agreement with the builder, original money receipt issued by the Sub-Registrar, acknowledged copy on authority letter, addressed by applicant to Sub-Registrar, copy of the letter acknowledged by the builder and own contribution amount proof.
4.Instant tax benefits
In an RTMI property, there are various tax benefits that can be earned, based on the person’s mode of payment. For example, home loans offer tax exemptions on the principal amount and interest paid under Section 80C, 80EE and 24 of the Income Tax Act.
5.No Delays
What further swings the needle in the favour of a ready-to-move-in-home is that there is no scope for uncertainties. The homeowner is not expected to pay any increased cost of the property after paying the token money. Once, the initial token amount is paid, the pre-decided cost of the property is constant. In fact, many buyers also enter an MoU to ensure the pricing, payment schedules and possession date of the house are definite. The aspiring home buyer has to make the payment, get their paperwork in place, and the home is instantly theirs.
With such benefits, Ready-To-Move-In properties ensure that the long-standing dream of becoming a home-buyer is instantly fulfilled.
By Disha Khemchandani
Disclaimer: This article has been produced on behalf of Lodha by Times Internet's Spotlight team.