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BENGALURU: The price gap between ready-to-move-in (RTM) and under-construction (UC) homes has declined from 5-8% in 2018 to 3-5% across cities, property advisory Anarock said on Monday.

In 2017, the difference between the two categories was between 9% and 12% across cities.

Delhi-National Capital Region (NCR) and Mumbai Metropolitan Region (MMR) recorded the least price difference between RTM and UC homes at 3%.

The average prices of RTM homes in NCR were Rs4,650 per sq ft while for UC homes, it was Rs4,500 per sq ft. In MMR, it stood at Rs10,700 per sq ft. and 10,350 per sq ft respectively.

“Previously, buyers of under-construction homes had one major advantage. Their patience and willingness to court construction risk were rewarded by notably lower prices. However, construction delays and stalled projects had a predictable outcome and risk-aversion set in, with demand tilted heavily towards ready properties," said Anuj Puri, chairman, Anarock Property Consultants.

“While the fact that RTM homes do not attract GST has been an added attraction, even the price gap between RTM and UC homes has eroded substantially," he added.

Pune, Hyderabad, and Chennai have the highest RTM-UC price difference at around 5%, while in Bengaluru and Kolkata, the difference is 4%.

The reduction in price gap works well for end-users as well as investors. End-users can see what they buy and save rent by moving in immediately, while investors focused on steady rentals can start earning right away, Anarock said. In the past four years, developers have been reluctant to increase the prices of ready homes as they need to clear their inventory.

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