Bangalore, officially known as Bengaluru, is a prominent city in Karnataka, India. It is often referred to as the ‘Silicon Valley of India’ due to its prominent position as the leading software exporter and major semiconductor hub in the country. Many tech enthusiasts and entrepreneurs seek to relocate to Bangalore to pursue their aspirations. Bangalore is recognized as one of the world’s fastest-growing major cities and serves as a hub for high-technology-based heavy manufacturing industries. It hosts numerous multinational technology corporations, including Google, Microsoft, and Amazon, which have established their headquarters in the city. Moreover, Bangalore is home to esteemed engineering and research institutions, attracting entrepreneurs to establish their businesses and tech enthusiasts to work alongside exceptional talents.
With its current population estimated at 11,644,000 people, Bengaluru experiences an increasing demand for real estate.When it comes to the real estate market in Bangalore, there are plenty of options for prospective buyers. One such option that has gained significant popularity in recent years is buying an under-construction flat. Under-construction flats offer a unique set of advantages that make them an attractive choice for many buyers. From a potential increase in property value to the opportunity to customise your space, there are plenty of reasons why buying an under-construction flat in Bangalore can be a smart move.
Whether you are a first-time home buyer or an experienced investor, read the points below to delve into the world of under-construction flats in Bangalore and uncover their potential benefits:
Buying an under-construction flat in Bangalore offers numerous advantages, with cost savings being one of the primary ones. Unlike newly constructed properties that come with higher price tags, under-construction flats are more affordable. Developers often offer competitive prices and flexible payment plans for buyers who commit to a property before its completion. This affordability allows potential homeowners to invest in a property that may have otherwise been beyond their budget. By opting for an under-construction flat, you can save money compared to ready-to-move-in flats. This translates to better value for your investment and significant savings on your purchase. Additionally, under-construction properties also come with tax benefits, making them even more appealing.
The Income Tax Act of 1961, specifically Section 24B, provides a tax benefit for under-construction properties of up to Rs. 2 lakh per financial year. This deduction applies to the interest paid on a home loan. Furthermore, taxpayers can claim an additional tax deduction of Rs. 50,000 under Section 80EE once they reach the Section 24B limit.
To add to the benefits, Section 80C allows for a tax benefit of up to Rs. 1.5 lakh per fiscal year for under-construction properties. This deduction can be made from the principal amount of the home loan.
All these factors combined make buying an under-construction flat in Bangalore a prudent choice, ensuring cost savings and favourable tax benefits.
When purchasing an under-construction flat, you often have the chance to personalize the interiors to your liking. This allows you to select the flooring, paint colours, and fixtures, and even make layout modifications to match your preferences and lifestyle. Personalization not only ensures that your home reflects your taste but also adds long-term value to the property. Modifying an under-construction flat to suit your needs can be a great option for those who want to create a unique home while also getting the best value for their money. Start by assessing the layout and available space before customizing the flat. This will help you determine the type of furniture and other items that can be installed in the flat.
Buyers can also choose customized fixtures and fittings such as windows, doors, kitchen cabinets, wardrobes, and other similar items. Reputed builders usually accommodate these requests and may even provide advice on the latest market trends.
Lower Down Payment
Another advantage of buying a property that is still under construction is the lower initial down payment requirement. Instead of paying the full cost of the flat upfront, developers typically ask for a smaller percentage of the total cost as an initial payment. This allows buyers to better manage their finances and arrange the necessary funds over the construction period. On the other hand, when purchasing a property that is ready to move in, buyers are required to pay large sums of money upfront, which includes stamp duty, registration fees, and other miscellaneous costs. In contrast, under-construction properties only require a booking fee, usually around 10-15% of the total cost. The remaining amount can be paid in instalments according to the construction plan. Buyers also have time to arrange for the stamp duty and registration charges. If the property is financed, buyers can pay EMIs to the bank.
Bangalore’s real estate market has consistently exhibited a strong pattern of capital appreciation. Investing in an under-construction flat can prove to be a wise decision, as the property’s value is likely to rise by the time it is completed. The price of a property increases as construction progresses, and the development of surrounding infrastructure further elevates its value. Thus, purchasing an under-construction apartment in its early stages is a prudent choice. To maximize your investment returns, it is essential to consider factors such as location, upcoming infrastructure, and nearby employment hubs. Moreover, when you purchase an under-construction property in Bangalore, a sought-after city for tech professionals and entrepreneurs, you can be confident that it is one of the most lucrative locations for real estate investment.
Most residential projects in Bangalore that are still being built offer a range of modern amenities and facilities. These can include top-of-the-line security systems, swimming pools, gyms, landscaped gardens, and much more. Developers strive to create a comfortable and luxurious living experience for residents, making under-construction flats an appealing choice for those desiring a contemporary lifestyle. When you move into an apartment that is still under construction, you can look forward to enjoying brand-new amenities. As the first occupant, you can be assured that you’ll be the first to use the gym equipment or the children’s playground. This means that you won’t have to worry about wear and tear anytime soon. In contrast, with ready-to-move-in apartments, these amenities may have already been extensively used by previous occupants and could be worn out or require frequent maintenance. The excitement of using new facilities is always invigorating and well worth the experience.
Reduced Maintenance Costs
Newly constructed buildings tend to have lower maintenance costs compared to older properties, and this advantage extends beyond mere financial savings. The incorporation of advanced construction techniques and materials in under-construction flats has revolutionized the concept of long-term maintenance, making it a key point of attraction for potential homeowners.
One of the primary reasons for reduced maintenance costs in newly constructed properties is the use of modern building materials and technologies. Developers now employ materials that are not only durable but also resistant to wear and tear, thus extending the life expectancy of various components within the flat. Additionally, under-construction flats often feature energy-efficient systems and appliances, which contribute significantly to lower maintenance costs.
Warranty and Quality Assurance
When you decide to purchase an under-construction flat from a reputable developer in Bangalore, you open the door to a world of quality assurance that goes beyond what is typically available when considering older, pre-owned properties. This quality assurance forms a fundamental aspect of the home-buying experience, instilling confidence and peace of mind in buyers.
Reputable developers understand the significance of delivering a superior product to their customers. To demonstrate their commitment to quality, they often go the extra mile by offering comprehensive warranties on the construction quality of the under-construction flats they are selling. These warranties serve as a powerful testament to the developer’s confidence in their workmanship and materials. They typically cover a wide range of aspects, including structural integrity, plumbing, electrical systems, and even the overall aesthetic appeal of the property. This means that any unforeseen issues related to construction, workmanship, or materials will be rectified at no additional cost to the homeowner, sparing them the stress and financial burden that often accompanies repairs in older properties.
Below are some frequently asked questions (FAQs) that you can use as a reference.
Yes, buying under-construction flats in Bangalore is beneficial as it offers easy payment options and higher appreciation value, resulting in a higher return on investment
Investing in under-construction flats provides numerous advantages. Firstly, they are priced lower than ready-to-move-in flats, and their value is expected to increase as construction progresses. Additionally, you have the flexibility to customize them according to your preferences.
Every floor has its pros and cons. Higher floors offer a breathtaking city view, while lower floors are more accessible during elevator maintenance.
Under-construction properties offer several benefits, including affordability, higher ROI, flexible payment options, discounts, and special offers.
Yes, you can sell an under-construction flat with a loan. However, the lender must provide a No Objection Certificate (NOC) or in-principle approval for the sale. A portion of the sale proceeds will be paid directly to the lender, with the remaining amount going to the seller. The lender will release the original title deed of the property once the total loan amount is received.
According to Section 24 of the Income Tax Act, no tax deduction is allowed for under-construction properties. Tax benefits can only be claimed once the construction is completed and possession is taken. The maximum interest deduction allowed per fiscal year is Rs. 2 lakh. Additional tax deductions can be claimed under Section 24B and Section 80C of the Income Tax Act.
Buyers of under-construction flats, apartments, and bungalows in India are subject to a 1% GST rate for affordable housing and a 5% GST rate for non-affordable housing. GST applies to the purchase of real estate land.