Under-Construction vs Ready-to-Move
| Factor | Under-Construction | Ready-to-Move |
|---|---|---|
| Price | 10–25% lower entry | Higher — market price |
| GST | 5% applicable | 0% with OC |
| Occupation | Wait 2–5 years | Immediate |
| EMI burden | Pre-EMI during construction; double if renting | Full EMI — no rent burden |
| Risk | Delay, default, spec changes | What you see is what you get |
| RERA protection | Full RERA applies | Post-possession only |
RERA Rights for Under-Construction Buyers
Your RERA Rights
- Builder must register project with state RERA before selling any unit
- 70% of all buyer collections held in dedicated escrow account
- Builder must honour RERA-registered possession date
- Delay: claim interest at SBI MCLR+2% or full refund with interest
- Carpet area shortfall at possession: proportional price refund
- 5-year structural defect liability from possession
Related Terms
Frequently Asked Questions
An under-construction property is purchased before construction is complete. Buyers pay in stages — linked to milestones (CLP) or schedule (TLP). It is typically 10–25% cheaper than ready-to-move. Under RERA, 70% of funds must be in escrow and builders must deliver by the registered date.
Much safer since RERA 2016 — escrow accounts protect funds, delivery dates are registered and enforceable, and delays attract compensatory interest. Key variable is builder quality: buy from builders with proven on-time delivery records and clean RERA histories.
5% GST applies on under-construction property payments. For affordable housing (carpet area up to 60 sq m in metros, value up to ₹45 lakh) it is 1%. Ready-to-move properties with Occupancy Certificate are exempt from GST — factor this into total cost comparison.
Yes. Banks give home loans for RERA-registered under-construction projects, disbursed in tranches matching the construction-linked payment plan. Pre-EMI (interest only on disbursed amount) is paid during construction. Full EMI starts after complete disbursement or possession.
CLP (Construction-Linked Plan) ties payments to actual construction milestones — foundation, slabs, finishing, possession. You pay only when verified construction stages are complete. This is the safest payment structure — always prefer CLP over time-linked plans.