Pros and Cons of Purchasing a Resale Home

One of the most significant decisions you will probably ever make is whether to buy a property. Remember the secondary or resale market when there are hundreds of possibilities on the primary market. A resale market is a great place to find bargains when the primary real estate market is declining. The resale market also provides a variety of choices, such as ready-to-move-in properties, flexible payment plans, and quick possession.

In addition to the floor plan, amenities, and built area, you must be attentive when picking the location, interior, returns, investment, and other factors when investing in a resale home.

 Benefits of Purchasing a Resale Home: Older the Home, Lower Price:

Resale or used homes are frequently more cost-effectively priced than new residences. If the house is a separate piece of property, its value will be based on its location. You can also bargain for a lesser price based on the building's age, interior design, and fixtures.

 Future Location:

Contrary to newly constructed homes, often erected in the suburbs, resale homes are typically older homes built inside the city when there was accessible land. Living in a resale property is typically simpler because it is situated in an established neighborhood.

 Better Ambiance and Neighborhood:

Older homes for sale are often built with a lot of room and a certain degree of character. Older homes also tend to have a less cluttered ambiance. It is a bargain if you discovered a bigger resale home situated in a neighborhood and offered at a lower price.

 No rent, No EMI:

You can avoid paying the extra interest on the monthly installments for a house that is still being built when you buy a resale home. You must keep making EMI payments and interest until the house is finished. You can avoid paying rent by choosing from various possibilities for resale homes that have already been built.

 Integrated Amenities:

When purchasing a used home, you will typically find that the previous owner has already installed the essential fixtures and amenities. In these situations, amenities like gas, power, maintenance, security, and water facilities are typically pre-arranged. The amenities don't need to be reinstalled if they are carefully maintained. Before moving in, it could need some repairs, though.

 Benefit from Tax Deduction:

You may be able to get a tax break on the first monthly payment of a home loan by moving into an old house right away. According to the Income Tax Act, interest on home loans is tax deductible up to Rs. 5 lakh under Section 24B, and principal EMI is exempt from tax up to Rs. 1 lakh under Section 80C.

Cons of Purchasing a Resale Home: 

 Age of the Building:

Before making a decision, you should learn the building's actual age. The house you purchase is recommended to be no older than five years or no newer than 10 years. A property over ten years old is not a suitable investment. You must pick a home that isn't too ancient because the return on investment is inversely correlated with the property's age.

No Personalized Touch:

 It can occasionally be unnerving to purchase a resale home because the home may reflect the preferences or tastes of the prior owner.

Defaulted Building Fees:

Before you assume ownership of the building, you must ensure that the former owner has paid all the dues assessed against it. Sometimes the new owner, unaware of the same, is responsible for unpaid maintenance, membership, or social responsibility bills.

Multiple Renovation Fees:

A resale home may come fully furnished, but you should be aware of any renovation costs you may incur before or during the relocation process. Painting, flooring, woodworking, and plumbing renovations may seem minor, but when all together, they may cost a lot of money. Be diligent when deciding to select the one that requires the least amount of remodeling work. 

Lower home insurance:

A resale home typically has lower insurance rates than a new home. Most private insurance companies base their insurance coverage calculations on the age of the structure. Also, in such circumstances, when there is a theft or natural tragedy, insurance firms pay very minimal refunds. If you encounter the same, this could be a problem and leave you defenseless.

Excessive down payment:

You will be asked to put down 20% of the total cost of the property if you choose to take out a mortgage to buy a resale property. This price is more significant than what contractors charge.