If you are interested in investing in real estate and are exploring investment options, it is not uncommon to come across advertisements for pre-launch properties. These projects are more attractive than developed ones and you may find them to be an extremely lucrative proposition. Getting familiar with pre-launch properties and being aware of the benefits and risks involved would be wise.
At times, developers start selling properties right after drawing up their plans. These properties can be economically gratifying as they are priced at around 20-30% less than the properties that are ready to move into. The reason for this, as the name suggests, is that the property is yet to be launched. There are no regulatory permissions and approvals in place, and essentially this is just a proposal. Projects announced by developers at this pre-approval stage are known as pre-launch properties.
It helps developers raise capital that is interest-free from the market and solidify their capital pool. Buyers often prefer this as they are economically more lucrative than other similar built-up properties in the same segment.
1. The pre-launch property is priced lower
One of the most significant advantages of the pre-launch property is that it is 10 to 30% less expensive than a completed project of that type. This is the perfect way to attract buyers and get the developers to build their capital pool without spending on marketing and not having to pay interest on commercial loans. They allow these benefits to trickle to potential home-buyers by passing on a part of their savings as discounts.
2. Great low-cost investment with a higher return on investment
Pre-launch property buying is not only financially attractive because it is available at a lower cost. This is also a great investment opportunity as property rates will rise soon after everything is completed. So not only is it a guaranteed return on investment, but it is also a quick one. Unless there is an unforeseen event like the pandemic, the cost of residential properties usually increases. When you invest in a pre-launch commercial property, your property price will have appreciated as soon as the other shops in the marketing complex are constructed and ready to be sold.
3. More apartment choice options
The first few buyers are at an advantage because they get to choose an apartment with a location of their liking. Suppose you want a flat that gets a lot of sunlight, a sea-facing apartment or one from where you can see the park, or on a higher, lower floor etc.? You can make these demands and pick and choose because the apartments are yet to be assigned in a pre-launch property. Another reason developers allow you to have your way at this stage is that they are willing to raise funds and can make accommodations for your demands.
4. Easy customisation and add-ons to the apartment
When the building construction is underway, customisation becomes easier. This is because everything from the construction crew to the raw materials is available on-site. So if you feel the need for some additional woodwork, an extra grill, a faucet or an extra shelf, your developer will willingly agree to these minor adjustments.
5. Faster appreciation of the pre-launch property value
As discussed above, the return on investment on the pre-launch property will be high, but not just that. You do not have to wait too long for the price of your property to rise. The property prices will rise instantly post the successful completion of the project. As soon as the developer starts selling the constructed units, you can also choose to sell your property for almost 10-30% higher. If the surrounding area has been developed and there is a greater demand for your complex, expect a significant rise in prices.
Buying a pre-launch property is a big investment and an important life decision. Even though it comes at an attractive rate, you still have to pay attention to your due diligence. It is imperative to thoroughly research the property, and the developer’s reputation and go through the Real Estate Regulatory Authority guidelines before taking any decision. Visit other projects by the developer and know their project completion success rate. Do not fall for unrealistic promises and pressure being applied by the developers. Take your time.
You can always rely on a home-buying platform such as blox.xyz to guide you through this important life purchase. With the right insights and experts by your side, we will help you leverage your bargaining power and make the right decision.
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