Under-Construction Property Risks Guide Pune 2026 — How to Protect Yourself

Pune’s under-construction market is large — estimates suggest 60–70% of residential property transactions in Pune involve properties that haven’t yet received their Occupancy Certificate (OC). This is structurally different from Mumbai’s ready-to-move (RTM) dominated market or Delhi NCR’s post-RERA caution zone.

The under-construction market in Pune attracts buyers for legitimate reasons: lower prices (typically 10–20% below RTM equivalent), ability to customise interiors, better payment plan flexibility, and the chance to enter a project at early-stage valuations. But it carries risks that many buyers underestimate — and that this guide covers in full detail.

Risk 1: Builder Delay — The Most Common Problem

Builder delay is the most frequent risk event in Pune’s under-construction market. A delay occurs when the builder fails to deliver possession by the RERA-registered possession date in the sale agreement.

How Widespread Is Delay?

According to Maharashtra RERA (MahaRERA) data, over 30% of registered projects in Pune have applied for extension of possession date at some point. The COVID-19 period (2020–2022) created a force majeure situation that granted broad relief — but that window has now closed, and delays post-2022 have no blanket excuse cover.

How to Assess Delay Risk Before Booking

1. Construction velocity check: Visit the project site personally. A project with 80% construction complete and 8 months to possession is lower risk than a project with 20% complete and 18 months to go. Ask for the last MahaRERA quarterly progress report — builders must file these.

2. Sold percentage: A project that is 85%+ sold but only 40% complete has the weakest incentive to delay — the builder has collected most funds and needs to hand over to avoid penalty. A project that is 30% sold and 50% complete has comfortable builder cash flow and less buyer pressure.

3. Bank co-lending: If your project is financed by HDFC, SBI, or ICICI Bank (bank loan disbursed directly to builder), those banks conduct periodic construction monitoring. Bank-approved projects have an external check on progress. Ask the builder: “Which bank is funding your construction?” A project with no bank co-lending has no institutional progress oversight.

4. Previous delivery record: Check the developer’s completed projects on MahaRERA. If they have delivered 10 projects and 8 of them are marked “project complete with OC,” that’s a strong signal. If 5 of 10 have delayed more than 12 months, that’s a warning.

Risk 2: Quality Compromise

Under-construction quality risk is distinct from delay risk — it’s what happens to what gets built, not when. Quality compromise manifests in:

• Substitution of specified materials (branded tiles replaced with cheaper alternatives)
• Structural issues (inadequate cover to steel reinforcement, leading to seepage)
• Amenity delivery gaps (promised clubhouse delivered as a bare shell)
• Common area finish below sales brochure representations

How to Monitor

1. Visit the site during construction, not just at launch. Most buyers visit once at launch and then don’t return until possession. Request quarterly site access from the builder.

2. Hire an independent structural engineer for a ₹15,000–25,000 pre-possession inspection. This sounds expensive until you compare it to the cost of fixing seepage in a ₹90 lakh flat. The inspection report also gives you documentary evidence for any RERA quality complaint.

3. Compare the agreement specifications with actual delivery. Your agreement should list flooring specifications, sanitary ware brands, door quality. Cross-check at possession before signing the possession receipt.

Risk 3: RERA Protections — What the Law Actually Provides

RERA (Real Estate Regulation and Development Act, 2016) as implemented in Maharashtra (MahaRERA) provides two critical buyer protections:

Section 18 — Delay Compensation

If a builder fails to deliver possession by the agreed date (as registered on MahaRERA), you are entitled to:

• Interest on all payments made, calculated at SBI’s MCLR + 2% per annum, for every month of delay
• Alternatively, if you choose to withdraw from the project, a full refund plus the same interest rate from the date of each payment

Important qualification: Section 18 applies only to RERA-registered projects. Pre-RERA projects (registered before May 2017) and unregistered projects (illegal) have no Section 18 coverage.

MahaRERA complaint process:

• File online at maharera.mahaonline.gov.in
• Attach all payment receipts, sale agreement, and communication with builder
• Average resolution time: 3–6 months for compensation orders
• Order enforcement: District Collector can attach builder’s property for non-payment

Section 19 — Structural Defect Warranty

After possession, the builder is liable for structural defects for 5 years from the date of handing over. If a structural defect appears in the first 5 years, the builder must repair it at no cost to the buyer.

Limitation: Section 19 covers “structural defects” — cracks, seepage, and foundation issues qualify. It does NOT cover cosmetic wear, appliance failure, or damage caused by the buyer’s modifications.

Risk 4: Pre-Launch and Unregistered Projects

Pre-launch sales — where builders collect bookings before the project is registered on MahaRERA — are technically illegal under the Act. Yet they continue in Pune, often marketed as “expression of interest” bookings or “priority allotments.”

Why builders do pre-launch: They use early booking funds to meet initial land and construction costs before bank financing kicks in. The discount offered (5–10%) is the compensation for the risk you are taking.

Risks of pre-launch:

• No RERA number = no Section 18 or 19 protection
• No certainty that the project will receive approvals (environmental, height NOC, fire NOC)
• No escrow requirement (RERA mandates 70% of funds in escrow — this doesn’t apply to unregistered projects)
• In case of builder insolvency, your payment is an unsecured creditor claim — you’re last in line

Rule: Never pay more than a nominal refundable token (₹10,000–25,000) to a pre-RERA or unregistered project. Walk away from any builder asking for a full 10–20% booking amount on an unregistered project.

Risk 5: Force Majeure Clauses — What Counts, What Doesn’t

Almost every builder’s agreement includes a force majeure clause that allows delay without compensation in cases of “act of God, government action, natural disaster” etc.

What COVID-19 Established

The 2020–2022 pandemic established that a government-declared lockdown qualifies as force majeure, and MahaRERA granted extension to all registered projects for the lockdown period plus a reasonable recovery time. This was a one-time, extraordinary measure.

What Does NOT Qualify as Force Majeure in 2026

• Construction material price increases (normal market risk, not force majeure)
• Labour shortages due to wage disputes
• Approval delays due to builder’s documentation failures
• Slow sales velocity reducing builder’s cash flow
• RCC structure delays due to monsoon season (predictable and plannable — not unforeseeable)

Practical Advice

Read the force majeure clause in your agreement before signing. If it is broadly drafted (“any unforeseen circumstance”), negotiate a narrower definition or a clause limiting force majeure extension to a maximum period (e.g., 12 months maximum regardless of cause). Established builders (Kolte-Patil, VTP, Godrej, Paranjape) use fair, balanced clauses. Smaller or lesser-known builders sometimes use excessively broad clauses.

Risk 6: Builder Financial Health

A financially distressed builder is the worst risk scenario for a buyer. Signs to watch for:

ITR filing check: Builders (incorporated entities) must file income tax returns. Very few buyers think to ask for the builder’s last 2 years of audited financials or at least their ITR filing status. For listed companies (Godrej Properties, Kolte-Patil Developers — NSE/BSE listed), you can read quarterly results publicly.

NPA status: Ask your bank (if taking a home loan for this project) whether they lend against this builder’s projects. If major banks refuse to disburse against a specific builder, that is a strong signal of financial health concerns.

Multiple stalled projects: Check the builder’s portfolio on MahaRERA. If they have 3 active projects and 2 show “project lapsed” or “complaints filed > 20,” that suggests stretched resources.

Risk 7: Title Risk — The Invisible Problem

Title risk means the builder does not have clean, unencumbered ownership of the land on which your flat is being built. If the builder’s land has disputes, it can result in court injunctions stopping construction or, in worst cases, cancellation of the entire project.

How to Check Title

1. Ask for the 7/12 extract (Satbara Utara) — the land record that shows ownership and any encumbrances on the plot
2. Check for pending litigation — District Court case search on the plot’s survey number
3. Legal opinion: Pay a property lawyer ₹5,000–10,000 to review the chain of title documents before booking. This is not optional on a ₹70–150 lakh purchase.
4. Verify that the builder is the named owner or has a valid registered development agreement with the landowner

Mitigation Strategies — The Master List

1. Only buy RERA-registered projects. Verify the RERA number on maharera.mahaonline.gov.in before visiting the site office.

2. Prefer bank-approved projects. “Bank-approved” means a bank has done due diligence and will disburse home loans — this isn’t a guarantee, but it reduces title and builder quality risk.

3. 70% escrow is mandatory under RERA. Builders must deposit 70% of project receipts in a designated escrow account. Ask to see proof of the escrow account opening. Banks monitor escrow withdrawals for progress milestones.

4. Avoid pre-RERA builders. If a builder completed all their projects before 2017 and hasn’t registered a single RERA project, they are not operating under the current regulatory framework. Their liability protections are weaker.

5. Get a legal opinion before booking. ₹5,000–10,000 spent on a property lawyer reviewing title documents and the agreement is the best risk insurance you can buy.

6. Read the agreement before signing. Builders routinely ask buyers to sign the agreement within 2–3 days of booking. Request 7–10 working days to have a lawyer review the agreement. Reputable builders will grant this.

Pre-Booking Checklist

• MahaRERA registration number verified online
• Builder’s past project delivery record checked (MahaRERA completions)
• Site visit conducted — construction progress matches timeline
• Bank co-lending confirmed (HDFC, SBI, ICICI, or equivalent)
• Legal opinion on title documents obtained
• Agreement reviewed by property lawyer
• Force majeure clause reviewed and scope understood
• Escrow account details obtained from builder
• All promised specifications listed in the agreement (flooring, fixtures, amenity specs)
• Possession date, compensation clause, and refund clause clearly stated in agreement

Conclusion

Under-construction property in Pune is not inherently dangerous — it is manageable with the right due diligence. RERA has fundamentally improved buyer protections versus the pre-2017 environment. Large, RERA-compliant, bank-funded developers in Pune (Kolte-Patil, VTP Realty, Godrej Properties, Paranjape Schemes, Rohan Builders) deliver projects that carry manageable risk.

The risk is concentrated in smaller, under-capitalised builders, pre-launch transactions, and projects with observable financial or construction velocity warning signs.

For help evaluating the risk profile of a specific Pune under-construction project — including RERA status check, builder background, and agreement review guidance — visit Pune Realty Hub. Our team has on-ground knowledge of Pune’s builder landscape and can help you separate the credible from the concerning.