Fearful of delays, 60% of Home Buyers Prefer to Buy Ready Homes From The Resale Real Estate Market

Due of the delivery delays plaguing India's housing industry, 60% of homebuyers are now resorting to the resale market to acquire ready-to-move-in residences.

According to recent statistics, the ratio of resale to main transactions has increased from 1:1 to 2:1, meaning that for every one property sold in the resale market before, two properties are now sold in the resale market.

The change in choice is a result of builders' delays in acquiring projects. End users prefer not to incur chances during the building phase of a project. Additionally, it is easier for purchasers to see and feel a completed property and make an investment choice quickly than it is for them to invest in an under-construction project.

Bengaluru and Chennai, for example, have a resale-to-primary ratio of more than 2.5:1, owing to their high proportion of end-user homebuyers.

Gurugram in Haryana and Noida in Uttar Pradesh have a lower resale-to-primary ratio—1.5:1—owing to a significant share of investment purchasers.

In Bengaluru and Chennai, 72% of purchasers choose to purchase property via the resale market, compared to 60% in the NCR.

Due to the fact that the resale market is driven by purchasers seeking primary residences rather than investment properties, the main demographics are young families and those over the age of 35.

A neighborhood's resale/primary transaction ratio is a powerful indication. Due to supply restrictions in well-developed and/or older neighbourhoods, where new construction is scarce, purchasers choose resale houses on the market.

Due to the abundance of new developments available, new and emerging communities will have a low resale versus primary ratio. Generally, urban areas will have a larger resale to primary ratio, and vice versa.

Apart from the feel and touch factor and the reduced risk of possession delays, homebuyers generally prefer to purchase a property in the resale market because GST is applicable in the primary market if the property does not have an occupation certificate, which is typically the case given that the majority of primary properties available are under construction.

Following the three COVID-19 waves, fresh launches have decreased substantially in comparison to five years earlier. Additionally, there is a large inventory of unsold homes available on the resale market. 

Additionally, the majority of purchasers (almost 75%), choose 2 BHK flats, while 25% seek 3BHK ones.

There is greater bargaining flexibility in the secondary market since it is a customer-to-customer transaction and owners have often previously profited from their investments.