Buying a home, in general, is a once in a lifetime decision for most of us. The emotional value attached to a home and the overall financial amount involved, makes it a critical decision in a person’s life. There are several variables that are considered – either consciously or even sub-consciously – while buying one’s dream home.
Some of the most obvious variables, including but not limited to, that are given ample thought are as follows:
- Location
- Size and Configuration
- Budget
- Builder Brand Value
In addition to the above, there are several other factors that influence a buyer’s final home buying decision. These factors are unique to every individual, and each buyer may respond differently based on personal priorities, budget, lifestyle, and long-term goals. Whether someone is exploring residential projects in Ahmedabad or evaluating different property investment options, understanding these variables is essential before making a final decision. Some of the key factors are as follows:
- Usage Goal: end use for self, end use for parents/family, investment, rental yield etc.
- Usage Timeline: immediate or delayed possession, depending on other factors.
- Location Outlook: For affordable and budget home seekers, the future growth potential of a location may be the deciding factor. However, for luxury buyers, an established & posh location makes more sense.
- Vastu: layout appeasing one’s need for Vastu compliance. Even numerology & astrology plays a pivotal role in some cases.
- Religious & Community Coherence: this is again an individualistic variable. Some prefer a homogenous stratum of people in the vicinity, whilst others may look at a more cosmopolitan diaspora.
The above are all reasons that each person reacts to in a different manner. There is not set rule or pattern that can govern any of the above. There is one decision, however, that each buyer needs to make – Which stage of a project’s lifecycle should one enter into while home buying? Any or all of the above factors lend themselves into making this choice.
This article aims at sharing a ready reckoner on the brass tacks of a project’s lifecycle. We will cover the various stages, the innate advantages and cons of each stage, and what stage of a project is best suited for a ‘typical’ buyer.
Project Lifecycle and Stages
Any real estate project will have the following stages across its entire life:
- New Launch or Pre Launch: This is the first stage in any project’s lifecycle. This stage starts when the Builder has finalized launching a project and is warming the trade & the market with relevant information to gauge the demand and the expected uptake this project can yield. Then the project is ‘officially’ launched for bookings, post RERA registration. Any project, typically, gets the maximum push & share of voice from all stakeholders during this stage – builder, channel partners, brokers, market. This stage typically lasts for about the first 90 to 180 days.
- Under Construction or Sustenance: This is the stage when actual physical construction is carried out by the builder. Depending on the size & scale of the project this stage can last for anywhere between 18 months to above 3 years.
- Ready to Move or Ready Possession: This stage is when the project is ready to be delivered and buyers can actually move in to reside. This stage is officially marked on receipt of the Building Use Permission or the Occupancy Certificate.
- Resale or Secondary Markets: The above three stages of a project are within the jurisdiction of the builder – Primary Market. In these three stages the project is being bought by the buyers from the builder – first sale. Once a project matures and people start occupying it, a secondary market also revealing information – the Resale Market. In this stage an owner sells his property to another interested buyer. In this case the transaction is at a unit or apartment level and not at the project level.
New Launch or Pre Launch: Pros / Cons Best Suited for:
Pros:
- Choice of Inventory: Given the project has just been launched, nearly all units are available. Hence a buyer can get an inventory as per one’s specific choice.
- Pricing Benefit: Prices are usually the lowest at the launch phase of a project that any other stage in its lifecycle. In addition, builders often come up with attractive payment plans which extend further price benefit to the buyer.
- Market Push: The heaviest marketing noise is made during the launch phase. The entire trade comes active during this period to attract potential buyers. This fanfare augurs well for buyers.
- Longer Payment Terms: The payment terms often are staggered at this stage of a project. Hence it fits well as a delayed investment tool for a buyer and lends to asset creation with lower upfront cash/capital outflow.
Cons:
Actual vs. Proposed: This phase has no physical construction available, except a sample house in some cases. Hence, the sale is basically done on a presentation or a brochure. There may be a difference between actual delivery and the buyer’s initial expectations.
- Delivery Timeline: Actual delivery timelines might get delayed during the construction phase. Delays to the excavation stage due to monsoons and dependence on the unorganized labor market may be some factors that can cause slight delays in overall project delivery timelines.
- Raw Material Price Fluctuation: Prices of various raw materials may see unforeseen fluctuations during the project’s entire life cycle due various uncontrollable reasons like market dynamics, geopolitical developments and other external factors. Some part of such exigent cost might have to be passed on to buyers as well.
- Regulatory & Legal Risk: It is important to do a basic background research before investing at this stage. In case a project does not have necessary registrations and/or approvals in place, it may lead to unnecessary delays and/or unexpected cancellations.
Best Suited for:
New & Pre Launch stage is ideal for someone who wants an unit of his choosing and at the best possible price with a longer payment term. Also someone, whose goal is to seek maximum capital appreciation.
Under Construction or Sustenance: Pros / Cons Best Suited for:
Pros:
- Actual Construction: Visible progress can be seen which helps to assess built quality & track timelines firsthand.
- Pricing Benefit: pricing at this stage will still be lower than ready units.
- Choice of Inventory: Buyer will have decent choice available at this stage also.
- Construction Linked Payments: At this stage, commonly, payments are linked to construction milestones being hit, thus easing cash flow pressure. Builders Self-Subvention or Bank Subvention 20:80 payment plan which gives the buyer EMI free period till possession.
- RERA Protection: Projects in this stage are mandatorily under RERA purview, thus providing a systemic & regulatory safeguard against delays, diversion and delivery risks.
Cons:
Delay Risk: Though RERA registered, projects still can face extensions due to the dependency on the unorganized labour availability. There are penalties, but it doesn’t eliminate the inconvenience of any delays.
Fluctuation: Any shift or change in property rates of the locality before possession may have to be partly borne by the buyer.
Best Suited for:
The under-construction (sustenance) stage is best suited for buyers who do not want to wait too long and also are not willing to compromise heavily on inventory (unit / floor) selection. Also ideal for discerning buyers who would want to see physical construction and a balance between price advantage & regulatory protection.
Ready to Move or Ready Possession: Pros / Cons / Best Suited for:
Pros:
- Actual Inventory: Zero construction risk in this stage. What you see is what you get. No surprises on layout, quality or amenities.
- Immediate Possession: Property available for usage from day one, technically.
- Saving on Taxation: There is no GST liability on purchase as ready-to-move properties with an BU certificate are exempt from GST.
EMI can replace Monthly Rental: in the case of ready to move if buyer is staying on rent and buy a ready to move apartment can replace rent with EMI.
Cons:
Lack of Choice: The best units (floor, view, size etc.) have already been sold.
Higher Price: The project is its costliest at this stage.
Best Suited for:
Buyers who prioritize certainty and who need to move into the new property within a fixed time line (either moving into a new city, or moving out of a rented apartment, etc.).
Resale or Secondary Market: Pros / Cons / Best Suited for:
Pros:
- Negotiable Pricing: Motivated sellers (distress sales) often are Unlock to pricing negotiation, and hence the buyer can get a decent bargain as compared to the existing market.
- Immediate Possession: Property available for usage from day one, technically.
- No GST: Resale transactions are exempt from GST both from buyer & seller side.
Cons:
Onus of Due Diligence: As the seller here is not the builder, hence the entire onus of due diligence of the property is on the buyer. These can include but not limited to, clear title, outstanding loans, society dues, legal encumbrance etc.
- Renovation Expenses: In case the property is in an older builder, it might need some renovation expenses.
- Limited Amenities: Resale units in older societies tend to have lesser amenities as compared to societies launched & completed in the recent past.
- Parking Availability: Older societies also tend to have limited allocated car parking spaces, which may lead to some hassles.
Best Suited for:
Buyers who value a particular location more than their choice of a latest layout are ideally suited for resale units. Also, buyers who intend to stay in an established area with limited new project launches can also look at resale units.
The Bottom Line by Vital Space
There is no “universally best” stage to purchase a property. It is a subjective decision based on a buyer’s preferences, choices, expected timelines, and investment goals. While pre-launch projects in Ahmedabad may suit buyers looking for higher appreciation potential or looking for preferred location unit/floor at best rate. Ready possession flats in Ahmedabad and resale properties are often preferred by families who need immediate shelter.
It is always advisable to make an informed decision and seek guidance from experts who deal with different residential projects on a daily basis. The quality of information you rely on often determines how prudent your property investment decision will be. At Vital Space, we specialize in guiding buyers through their real estate journey by helping them evaluate the best options based on genuine market insights and expert advice. Whether you are looking for flats for sale in Ahmedabad or exploring property in Gandhinagar, our team aims to make the process more transparent and informed.
