In recent times, we have witnessed a steep rise in the sales of pre-launch buildings by developers in Hyderabad. It will take some time for TS RERA to fully curb such fraudulent acts by the developers; however, buyers are showing interest in pre-launch offers for the sole reason of low rates. They have no interest in investigating if the developer can construct the apartment on time and deliver it as promised. Notably, some of the recent builders in Kokapet are competing and selling flats in pre launches, and people are showing keen interest in such projects. Now, is it fine to invest in such projects? Or is it better to buy flats in projects that are in the final stages of construction in the same area? Let us find out in this article:
Location: Kokapet
Pre-launch price: Rs 6000–8000 per sft.
- Complete payment (100% payment) must be made in advance
- No RERA permission
- There is no clarity on the sizes of the flats
- It is not known whether the construction will be completed or not
- Five years’ of waiting for the project completion
Ready to Occupy Price: Rs. 8000–10,000 per sft
- Bank loans are available.
- RERA approved
- Choice of preferred flat size
- Completes within six months
- Home warming after completion of interiors
If we look at the pre-launch offers, some companies in Kokapet are selling flats at Rs. 6,000 to 8,000 per square feet. Some investors are eager to invest in them, although they don’t have RERA approval yet. A builder must spend crores to acquire land; for this, they are taking money from buyers in the name of pre-launch and later purchasing these lands. The million-dollar question is how the construction will be carried out. Even if they take loans from banks and financial institutions, considering the increasing cost of construction, unless they sell it at a higher rate, it will not be profitable. Also, who will buy flats at fixed rates after the construction work begins? How many people can afford to pay a higher price? In any case, the project with the lowest rate will be chosen in the end. There will be fewer people who will buy at a higher rate.
Is ready-to-occupy better?
Be it Kokapet or Kondapur, those who want to set up a permanent residence in Hyderabad and those who want to earn good rents should choose projects that will be completed within six months. It is enough if you pay 20% of the flat value first, then you can get a bank loan of up to 80%. Since it is a RERA-approved project, the RERA authority will take care of structural defects for up to five years. People have the facility to choose the flat they like, and once the house is handed over by the builder, the interiors are completed and they can move in. So, for those who are really keen on buying a house, it is best to buy flats that are in the final stage of construction. The other benefit is that there is no mental anxiety about the project.
Pre-launch builders too
will face the same risk
The increasing number of pre-launches in the Hyderabad real estate sector has an adverse effect on the projects in the final stages of construction. This situation exists not only in Kokapet but in all regions of Hyderabad. Every builder who has started construction with RERA permission and taken the project to the advanced stage is facing trouble due to pre-launches. It takes at least three to four years to construct a multi-story building or a skyscraper. But because some promoters are announcing pre-launch offers, the actual builders are bearing the brunt. An interesting point to be noted here is that companies selling pre-launches today will have to face the same problem that other builders are facing later. So, pre launch offers are damaging the real estate sector badly. Because of this, it can be noted that flats remain unsold even in completed projects.
