Property in Kolkata For Sale: New or Resale Property

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Every Kolkatian young or old dreams of buying a property in Kolkata for sale at least once in their lifetime! Such is the charm of the Bengali capital that the thought of owning a home to call one’s own is a cherished life-goal nursed by many residents. 

Now, we know that buying a property is one of the biggest decisions one can make in their adult life. There are many things to consider. Like do you want an apartment or an independent house? Which area of the city do you want to live in? Do you want to buy a home directly from the builder or should you consider a resale property? How should you proceed? In this blog we’ll assess all factors you must consider as you look for a property in Kolkata for sale.

Property in Kolkata for sale: New vs Resale

One of the most important decisions one has to make when buying properties for sale in Kolkata, is whom to buy the home from. There are two options. You can either buy a fresh unit directly from a developer or you can buy a pre-owned property from an owner that is up for resale. The first type of property purchase is considered a primary market purchase and the second type of purchase is known as a secondary market purchase. Both options come with their pros and cons and in this article, we will discuss them in detail. 

Home Repair and Customisation

New Property: A new property is one that has never been lived in or used for any purpose. So in case of a new property, you will not have to worry about any damage or repairs. Everything will be given to you in mint condition. On top of that, you can make changes to the property from the beginning and customize it to your liking.

Resale Property: A resale property may have been lived in before. If that is the case, chances are that it might need repairs and upkeep. This can be anything from a simple house paint job to more complicated wood and waterworks. Additionally, the property might already be customized to someone else’s preferences, and hence, customizing it further may be harder and more expensive.

Payment Plan

New Property: One of the most important advantages of buying a new property is in terms of payment. Paying for an under-construction new unit directly from a developer may give you the flexibility of picking a customized payment plan. The most popular type of customized payment plan is the construction linked plan. This can reduce the financial burden on you by a great amount.

Resale Property: The main con of purchasing a resale apartment is that payment is usually required in a lump sum amount. Or at best, in a few installments over a short period of time. There is no facility of EMI for this type of transaction. Arranging for a big amount of money for immediate payment can be a huge financial burden. If either you or the seller engages a broker or property dealer in Kolkata to facilitate the transaction, then the brokerage fee is an additional expense that can at times be quite steep. Brokers for property in Kolkata for sale usually charge 1%-2% of the total transaction value. 

RERA Compliance

New Property: Since the implementation of the Real Estate (Regulation and Development) Act (RERA) on 1 May, 2017, all under-construction and new properties for sale in Kolkata have to be mandatorily registered. Thus, buying a new property is safer than ever now since it ensures transparency of information and transactions by law, something that is not present in all resale property. Moreover, RERA has also established Appellate Tribunals to protect the interest of buyers in case of any delay or default by the developer. This provides an additional safety net when buying a new property. 

Resale Property: Older properties in Kolkata with an Occupation Certificate dated prior to May 1, 2017, which includes most of the properties available for resale, are excluded from the purview of RERA, thus greatly increasing the risk involved.

Negotiation

New Property: In the case of a new property, the scope for negotiation on the price of the property is limited, since the price is pre-determined for all buyers. 

Resale Property: There is more scope for negotiation on the price of the property, especially when the real estate market is down, in the case of resale properties. Many people sell their property for low prices when the real estate market is bad to recoup some of their investment, in which case more negotiation might be possible.

Possession

New Property: Buying an under-construction new unit from a developer may result in delayed possession. Although RERA protects the buyers in case of such a situation, many times there are unforeseen circumstances that may postpone the finish date of a project. In this case, the buyer will have to make adjustments till the building is given the Occupation Certificate and they are allowed to move in.

Resale Property: There are more ready-to-move options available in the case of resale properties in Kolkata. In the case of a new property, many times you have to wait until construction and development of the property is completed and they have been given permission to allow possession by the municipal authorities. The same is not the case with resale properties since they are already occupied.

GST Implication

New Property: One con of buying a new unit is that it attracts a GST of 5% of the total cost of the property. 

Resale Property: This tax does not apply to the resale property.

Transfer Fee

New Property: There is no Transfer Fee in case you book a new property in Kolkata.

Resale Property: Some developers may charge a Transfer Fee on the resale of a property to handover the ownership from the first buyer to the second buyer.

Conclusion

As you can see both new properties and resale properties come with their own set of pros and cons. When buying a property in Kolkata for sale, you must consider which kind of property will best suit your needs. In case you are looking for a fresh apartment that has never been lived in before, and which you can customize as per the needs of your family, then a new apartment might be the way to go. Although it attracts a GST fee, you will be protected by RERA guidelines and might find a suitable payment plan which eases the stress of paying for a new property. There are many ready to move new apartments for sale available in upcoming residential projects in Kolkata.