Top Mistakes Homebuyers Make While Booking Under-Construction Properties

Buying a home is one of the most significant financial and emotional decisions an individual or family can make. Among the various options available in the real estate market, under-construction properties often attract homebuyers due to their comparatively lower prices, flexible payment schedules, and promises of modern amenities. However, what appears to be a lucrative investment on paper can quickly turn into a source of stress and regret when crucial details are overlooked.

In this blog post, we’ll cover the most common mistakes homebuyers make while booking under-construction properties in India, with actionable insights to help you avoid them. This guide will ensure you're not only informed but also protected from unforeseen risks.

Failing to Verify the Credibility of the Builder

One of the gravest errors homebuyers commit is booking a property from a builder without performing a background check.

Why This is Risky:

Many real estate developers operate with little accountability. Some have a history of incomplete or delayed projects, litigation, or financial instability. Blind trust in advertising or brand name can leave homebuyers vulnerable to scams or poor-quality developments.

How to Avoid This Mistake:

Research past projects: Look for completed projects by the same developer and whether they were delivered on time.
Review financial credibility: Builders with strong balance sheets and clean loan repayment records are more reliable.
Check for litigation history: Avoid builders involved in land disputes or consumer complaints.
Look up the builder on RERA: Make sure they are registered under the Real Estate (Regulation and Development) Act and check the status of their past and ongoing projects.

Booking Properties Without RERA Registration

Under the RERA Act, it is mandatory for developers to register their under-construction residential projects. However, many buyers unknowingly invest in unregistered projects.

Consequences of Booking Unregistered Projects:

No legal protection under RERA
No guaranteed possession timeline
No transparency about project details or changes
No recourse in case of fraud or misrepresentation

Best Practice

Always cross-check the project’s RERA registration number on your state’s official RERA website. The portal will also reveal:

Project layout approvals
Expected possession date
Phase-wise progress
Status of legal approvals and licenses

Relying on Verbal Commitments Instead of Written Agreements

Sales representatives often make enticing promises — early possession, free parking, or waived charges — all of which may not reflect in the final agreement.

Potential Fallout:

Promised delivery in 24 months takes over 5 years
Amenities like clubhouses or pools may never materialize
Verbal discounts or offers are not honored

What You Should Do:

Get all commitments in writing, including possession dates, penalty clauses for delay, and detailed specifications.
Insist on an official Builder-Buyer Agreement and do not sign until every clause is clarified.

Overlooking the Detailed Cost Structure

Advertisements often highlight “starting from” prices, but these rarely represent the final amount payable.

Hidden Charges May Include:

GST (Goods and Services Tax)
Legal fees
Clubhouse and society charges
Infrastructure development fees (IDF)
External and internal development charges (EDC/IDC)
Floor rise premiums

Expert Tip:

Ask for a final, all-inclusive cost sheet with complete payment milestones. Do not proceed without clarity on each fee component.

Skipping Independent Legal Due Diligence

Many homebuyers assume that the builder has already taken care of legal clearances. This assumption can lead to severe complications later.

Legal Risks Include:

Construction on disputed land
Lack of environmental or zoning clearance
Absence of valid commencement certificate
Delays due to pending court cases

Suggested Approach:

Hire an independent real estate legal expert to examine:

Title deed
Mother deed
Encumbrance certificate
Approved building plans
Environmental clearance certificates

Ignoring Construction Quality and Materials Used

Because buyers cannot physically inspect a finished product, they often have no idea about the actual construction quality until it's too late.

Possible Issues:

Poor waterproofing and insulation
Cracks in walls due to weak structure
Substandard electrical and plumbing work
Deterioration within the first few years

Due Diligence:

Inspect ongoing construction stages whenever possible
Ask for samples of raw materials used — cement, tiles, fittings, etc.
Request a written guarantee for structural safety, especially in earthquake-prone zones

Choosing the Project Based Only on Price

Cheaper isn't always better. Prioritizing price over location, developer quality, and future livability is a common pitfall.

Long-Term Disadvantages:

Poor connectivity and infrastructure
Limited access to healthcare, schools, or public transport
Low resale value and rental yield
Higher maintenance due to poor construction

Smarter Strategy:

Evaluate value over price. Compare projects on the basis of:

Developer reputation
Civic infrastructure development
Future metro or highway connectivity
Legal soundness of the project

Signing Agreements Without Legal Review

The builder-buyer agreement is legally binding, yet most buyers sign it without reading the fine print.

Critical Clauses to Review:

Payment default penalties
Delay in possession and compensation clauses
Cancellation and refund policies
Escalation clauses for construction costs
Defect liability period post-possession

Recommendation:

Engage a property lawyer to review the agreement line-by-line. Do not rely on the builder’s legal team.

Overstretching Financial Capacity

A tempting offer or larger flat may lead you to commit to an amount beyond your means.

Financial Repercussions:

Dual burden of EMIs and rent due to delayed possession
Stress on monthly budget due to maintenance and utility bills
Compromised emergency fund or retirement savings

Financial Planning Tip:

Use a home loan eligibility calculator and never go beyond 40-45% of your monthly income.
Factor in registration costs, furnishing expenses, and moving charges.

Skipping Site Visits and Relying Solely on Brochures

Brochures and digital renderings are designed for visual appeal. The real picture often differs.

Risks of Not Visiting:

Construction pace may be slower than advertised
Local environment may include pollution, traffic noise, or lack of amenities
Distance from metro, schools, or shopping centers could be greater than claimed

Site Visit Checklist:

Verify construction progress
Check access roads, water, and electricity connections
Speak to local residents or ongoing construction staff

Bonus Mistake: Falling for Pre-Launch or Soft Launch Offers

Pre-launch bookings often offer major discounts, but come with heightened risks.

What You Risk:

No RERA registration
No timeline commitment
Money stuck in delayed or abandoned projects

When to Consider:

Only invest in pre-launch projects if:

The developer is financially sound and reputed
You have documented proof of land title and future approvals
You are comfortable with a long investment horizon and high risk

Informed Decisions Lead to Safer Investments

Under-construction properties can provide immense value, but only when approached with caution, clarity, and due diligence. As a buyer, it’s your responsibility to research thoroughly, document everything, and prioritize legal and financial safety over urgency or discounts.

Recap of Key Actions:

Always choose RERA-registered projects
Verify the builder’s track record and approvals
Read and understand all agreements and legal documents
Account for the complete cost of ownership
Consult independent experts where necessary

A home isn't just a roof over your head — it’s a lifelong investment. Making a mistake at the booking stage can set you back by years, financially and emotionally. Avoid these mistakes, and you’ll enjoy not just your property, but also the peace of mind that comes with a smart decision.