BEFORE BUYING A HOME: QUESTIONS TO ASK REAL ESTATE DEVELOPERS
Building a home is a huge financial investment. So, to make that big decision, it is highly advisable to choose a reliable real estate developer. Hence, there are many issues that you need to look into before deciding to put your life’s savings in a developer’s project:
What’s the land use?
Check the land use of the property on which the project is being developed. The license states what the land use is: whether it is for developing residential or commercial property, floors or plots, and so on.
Has land acquisition been completed?
Often developers begin to sell apartments before land acquisition is over. Some unforeseeable problem may arise due to which acquisition may not be completed. The developer may manage to buy 80% of the land they need but get embroiled in a dispute over the balance 20%. Now, if that one tower in which your apartment was planned was to be developed on the disputed 20%, you would experience many challenges.
Does the developer have legal title?
Ask the developer to show you the papers demonstrating his ownership of the land. Every plot has a unique number. Ask the builder for that number and check in whose name the plot is registered. You could hire a lawyer to conduct the title search. He can also find out if there is a legal dispute over the land.
Are all the approvals in place?
Ask the developer for the license, which is proof that they have obtained permission from the area’s town planning authority to develop the project. Every license has a unique number. Developers who have obtained the license often print the license number in their ads. Also ask whether the developer has received the following approvals: building plan, water, environment and pollution, and height clearance (if the building is situated near an airport).
What if the plan changes?
Often, developers show you one building and layout plan at the time of sale, but alter it midway through construction. The flat’s area could increase. The original plan may have shown a swimming pool and club opposite your apartment. Instead, another block of apartments may come up in that space. Read the builder-buyer agreement closely to find out if any redress is available to you if the plan changes.
Is an early exit permitted?
Sometimes you may change your mind and decide not to keep an apartment. Enquire whether an early exit is permitted. When some developer’s own inventory doesn’t sell, they impose curbs so that people are not able to buy from the secondary market. Has the developer blocked sales in the past? And what transfer fee will be charged for an early exit?
What if you don’t pay on time?
If by chance there is delay on your part in paying an installment, how much extra time will the developer grant you to pay up? What will be your interest liability? Will your allotment be cancelled? What are the provisions of the forfeiture clause? How much money will be returned to you?
How good is his track record?
Find out how many projects the developer has delivered in the past. Avoid novices as they usually lack the financial strength to weather a downturn. Visit an established developer’s past projects and speak to the residents (if possible). Did the developer hand over possession on time? Did he provide all the on-campus facilities and the specifications promised within apartments? How well has he maintained the project after its completion? In case of an under-construction property, visit it with a civil engineer and have him evaluate its construction quality.
Choose a credible real estate developer, and you won’t just be buying a unit or a piece of real estate, you’ll be stepping into a new lifestyle.
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