In the bustling cities of Bangladesh, where every square inch of land comes at a premium, the concept of buying second-hand flats has carved out a significant niche. While new real estate projects glitter with promises of modernity and grandeur, pre-owned flats present a fascinating alternative. But in a dynamic and nuanced market like Bangladesh's, is buying a second-hand flat a wise investment or a hidden trap?

The appeal of second-hand apartments

One of the standout advantages is affordability. "Second-hand apartments in Dhaka are often priced 20-30 per cent lower than new constructions, making them accessible to a wider audience," says Khan Tanjeel Ahmed, General Manager of Business Intelligence at Bproperty. These cost savings open up possibilities for middle-income buyers to enter coveted neighbourhoods that might otherwise be out of reach.

Another benefit is location. Second-hand apartments are typically situated in well-established neighbourhoods with existing infrastructure. "These areas provide immediate access to essential services like schools, hospitals, and markets, eliminating the waiting period that comes with developing new constructions," Ahmed adds.

Additionally, resale flats are ready for immediate occupation, a significant advantage over under-construction properties often plagued by delays. Buyers also enjoy the flexibility to renovate and personalise older properties, tailoring them to their preferences.

Navigating the risks

Despite these advantages, second-hand apartments come with challenges. Ageing buildings may require structural repairs, increasing long-term costs. "Approximately 35 per cent of second-hand apartments sold in Dhaka between 2015 and 2022 needed structural upgrades or repairs post-purchase," Ahmed shares, citing a recent real estate report. Hiring a structural engineer to inspect for cracks, mold, and utility issues is highly recommended.

Legal complications are another concern. Verifying ownership, ensuring there are no unpaid dues, and confirming a clear title can be daunting tasks. Older buildings may also lack modern amenities like parking spaces or elevators, potentially diminishing their appeal and resale value.

Preserving value over time

Certain areas and property types tend to retain value better. "Neighbourhoods like Gulshan, Banani, and Baridhara show annual property appreciation rates of 6-8 per cent, driven by their prime locations and comprehensive amenities," Ahmed explains. Similarly, properties in Dhanmondi and Uttara fare well due to robust infrastructure and community facilities.

Well-maintained apartments equipped with modern amenities are more likely to hold their value. Buildings managed by reputable associations are particularly appealing to buyers seeking long-term investment security.

Financing second-hand apartments

Financing options are widely available for second-hand properties. "Banks and non-bank financial institutions in Bangladesh, such as BRAC Bank and DBH, offer home loans covering up to 80 per cent of a property's value," notes Ahmed. These loans make the purchase process smoother, especially for first-time buyers. Combining personal savings with family loans or exploring seller-financing options can also make ownership more feasible.

Making a second-hand flat purchase work for you

If you're considering a resale flat in Bangladesh, here are some tips to ensure your investment is sound –

Hire an engineer or a trusted builder to evaluate the flat's condition, focusing on structural integrity, plumbing, and electrical wiring.

Cross-check the property's title deed, past ownership records, and ensure no dues are pending for utilities, taxes, or building maintenance.

Budget for immediate repairs or upgrades. A flat in good condition may require less work, but older properties often need significant investment.

Lastly, given the legal intricacies of property transactions in Bangladesh, hiring a lawyer to verify documents can save you from future complications.

The verdict: Wise or unwise?

For some, a resale flat may be the ticket to owning a home in Dhaka's sought-after areas, while for others, the risks of ageing infrastructure and legal complications may outweigh the benefits – as Ahmed aptly puts it, "A second-hand apartment is not just a home; it's a chance to invest in a well-lived space with history while adding your personal touch."

Ultimately, the decision boils down to your specific needs and resources. A second-hand flat is not just a purchase – it's an opportunity to breathe new life into a space with a past, creating a home that's uniquely yours in the vibrant, ever-evolving tapestry of urban Bangladesh.