Under-Construction vs. Resale: Which is Riskier for NRIs?
The Direct Answer
For purely remote investors, Premium Under-Construction (from Tier-1 developers) is actually safer than Resale. Why? Because the title is cleaner, RERA protects the delivery timeline, and you don't have to deal with complex verification of 30-year-old deeds or mysterious heirs. However, Resale is better if you need Immediate Rental Income to cover an EMI.
The GST Factor
Under-construction properties attract 5% GST. Resale properties have 0% GST. On a ₹2 Crore apartment, that is a ₹10 Lakh difference instantly. Factor this into your ROI.
Comparison Matrix
| Feature | Under Construction (New) | Resale (Ready) |
|---|---|---|
| Payment | Flexible (Construction Linked Plan) | Down Payment (20%) + Loan (80%) Immediate |
| Title Risk | Low (if RERA approved) | High (Requires intense scrutiny) |
| Tax Benefit | EMI Interest deduction only after possession | Immediate deduction |
| Cost | Usually cheaper (Entry price) | Higher (Market price + Renovation) |
| Appreciation | High (Growth during construction) | Steady / Low |
The "Builder Subvention" Trap
Avoid "No EMI till Possession" schemes. These are often marketing gimmicks. If the builder defaults on the interest payment to the bank, your credit score gets hit, not theirs. Stick to Construction Linked Plans (CLP) where you pay as the building rises.
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