Buying process
Buying under construction versus ready to move in: general factors to weigh
A neutral look at the factors that differ between an under-construction flat and a completed one in Bengaluru, with the official sources to check. Not advice.
Short answer
Buying under construction and buying ready to move in differ in timeline certainty, payment structure, tax and cost treatment, and the risks involved. This guide sets out those factors neutrally and names the official sources to check. It does not recommend either choice, and the document checks do not disappear for a completed flat.
A comparison, not a recommendation
Neither option is better in general. Which one suits a household depends on its finances, timeline, tolerance for waiting and ability to check documents. This article lists the factors that change between the two so that you can reason about your own situation. It does not say which to choose, and nothing here is investment or financial advice.
What each term usually means
An under-construction flat is one in a project whose building work is not complete and which does not yet have an occupancy certificate. A ready to move in flat is in a building that has been completed and for which the occupancy paperwork exists. Between the two sit projects that are nearly complete, which are sometimes described loosely by sellers, so ask what exactly is meant and see the paper.
Timeline and certainty
With an under-construction purchase you are relying on a promised completion date. The date is on the RERA record and in your agreement for sale, and it can move. Our guide on RERA status and dates explains how to read it. With a completed building, the timeline question is mostly about how soon the paperwork and handover can be done, and you can see what you are buying.
A completed flat lets you inspect finish, light, noise, water pressure and the state of common areas. For an under-construction flat you rely on plans, a sample flat and the developer's stated specification, so it is worth asking for that specification to be attached to the agreement.
How payment is structured
Under-construction purchases often involve staged payments linked to construction milestones or to dates, while a completed purchase is often paid on a shorter schedule. The schedule is whatever the agreement says. The Act limits how much a promoter can take as an advance or application fee before a written agreement for sale is entered into and registered, so check the current text of Section 13 and your draft agreement for the exact position.
For a RERA-registered project, money you pay is meant to follow a protected pattern: the Act requires the promoter to declare, when registering, that a stated portion of the amounts realised from buyers will be kept in a separate scheduled-bank account used only for that project's construction and land costs (Section 4(2)(l)(D)), with withdrawals tied to the percentage of completion. Our guide on the 70 percent escrow rule gives the short version. This is a regulatory safeguard, not a guarantee against delay.
Tax and cost treatment
Some costs differ by stage. GST generally applies to under-construction residential apartments, while a sale where the entire consideration is received after the completion certificate or first occupation, whichever is earlier, is generally outside it. The details, rates and conditions are set by the CGST Act and notifications, so our guide on GST names the official source and asks you to check the current position. Stamp duty and registration apply when the sale deed is registered in either case.
Interest on a home loan can start in different ways. Lenders often release money in stages for an under-construction project, so the amount you owe and the repayment start can differ from a completed purchase. Ask the lender how the schedule would work for your case.
Documents: the checks do not disappear
In both cases you check the title, the approvals, the registration and the encumbrance record. For an under-construction project the occupancy certificate does not exist yet, so you check the commencement certificate and sanctioned plan and, later, the occupancy certificate at handover. For a completed project you ask for the occupancy certificate and the khata at the start. Our guide on documents to check before booking lists each document with its source.
- Under construction: RERA registration, sanctioned plan, commencement certificate, title documents, draft agreement for sale.
- Ready to move in: occupancy certificate, khata, completion details, maintenance and sinking fund arrangements, encumbrance record.
- Both: seller identity, loan approvals, and a lawyer's review of the agreement.
Risks that look different
The distinctive risk of an under-construction purchase is delay or change after you have paid part of the price. The Act gives buyers remedies in certain circumstances, and a lawyer should explain how they apply to your agreement. The distinctive risk of a completed purchase is hidden defects, missing paperwork or an unpaid dues trail, which you reduce through inspection and by asking for dues clearance in writing.
A resale flat in an older building adds its own questions about the society's dues, the state of the structure and the seller's title, which are outside the scope of this article.
Questions to put to yourself
These questions help you decide without relying on a seller's framing.
- When do I need to be living here, and what happens if the date slips by a year?
- How much can I pay now without strain, and how much can the lender release in stages?
- Am I comfortable judging a flat from plans, or do I need to see the real thing?
- Have I seen every document that applies at this stage?
What we cannot tell you
- We cannot tell you which option is cheaper or better for you. Prices and availability are not verified on our site, and your finances and plans are your own.
- We cannot predict whether a given project will finish on time. Use the RERA record, site visits and the agreement as your guides.
- This is general information, not legal, tax or investment advice. Speak to a qualified professional for your case.
Common questions
- Is GST charged on an under-construction flat?
- GST generally applies to under-construction residential apartments and generally does not apply where the entire consideration is received after the completion certificate or first occupation, whichever is earlier. Confirm the current position with the builder and a tax adviser.
- What happens to the money I pay a builder for a RERA project?
- Under Section 4(2)(l)(D) of the RERA Act, 2016, the promoter declares at registration that 70 percent of the amounts realised from buyers will be deposited in a separate scheduled-bank account used only for that project's construction and land costs.
- Do I still need to check documents for a ready flat?
- Yes. Ask for the occupancy certificate, khata, an encumbrance record and proof that dues are cleared.
- Where is the possession date recorded?
- The proposed completion date is part of the RERA record, and any extension is recorded there too. Your agreement for sale should state the date as well.
Sources
Read against these official sources on 18 Oct 2026. Rates, fees and procedures change, so check the current position on each site.