What should buyers look for when viewing a sample flat

 What should buyers look for when viewing a sample flat?

   A sample flat is a marketing practice adopted by developers to showcase the interiors and space management.  Therefore, one must be circumspect before   making a purchase decision based merely on such a visit

Buying a home, for many, is an emotional decision.  As a result, most people take this step soon after viewing the sample flat when visiting an under-construction project site.

  Most buyers feel euphoric when they enter a sample flat and are absolutely enthralled by the exquisite interiors and stylish fixtures.  But there are several other factors that buyers must consider before making their final decision.

What is a sample flat?

A sample flat is a fully furnished apartment prepared by the developer on or near the site of the proposed housing project.  It gives buyers an indication of the available space and offers possibilities of how it can be effectively utilised.  The sample flat helps buyers retain their confidence in the developer and gives them valuable insights into the overall look of the flat.  “A sample flat helps buyers envision their future home.  Based on the look and feel of the sample flat, one decides whether the investment is worth it or not.”

        These sample flats are used by developers as an effective marketing tool to attract prospective home-buyers.  “This strategy of viewing the sample flat before buying helps one foresee their new home and provides them with the details of the interiors, fittings, carpet area, and fixtures to be used in their future home.”  As these flats are furnished by professionals, they help buyers in optimising their space.  As ventilation and natural light are extremely crucial in a home, a sample flat can give a fair idea of the placement of windows and the flow of natural light in a home.

What should a buyer consider?

A simple detail that buyers often forget is that the sample flat has been designed for visitors much like how we decorate our house for guests.  For instance, developers might spend Rs 20-25 lakh on the interior design of a sample two-BHK flat.  These flats are designed by professional interior designers who use premium flooring, mirrors, and lighting techniques.  The quality of furniture in a sample flat and the actual flat will be different.  In a sample flat, the kitchen equipment, lighting fixtures, and bathroom accessories are top of the line; some of these features might be out of a prospective buyer’s budget for the time being.

Don’t get carried away by the plush interiors

Before seeing a sample flat, request the developer to let you visit their other projects to get an overall idea of their work, construction quality, and on-time delivery record.  Estimate the exact built-up area, carpet area, floor plans, fittings, fixtures and other relevant details.

        When you visit a sample flat, you must ascertain various aspects.  It is important to scan all the rooms carefully.  “A buyer must not get lured by the glamour of the sample flat and must do their due-diligence.  First and foremost, the buyer must check the overall layout of the flat and see if it meets their requirements in terms of the size of the rooms, balconies, toilets, etc.  Moreover, some buyers may prefer an extra balcony, or a small puja room/corner.  In that case, a sample flat may help the buyer ascertain these features.”

        Compare the brochure and layout plan with the dimensions and specifications of the sample flat.  Besides this, one must check the type of flooring used and gauge the quality of the windows, electrical work and sanitary fittings.  After the inspection, one must verify with the developer if the same fittings and fixtures will be used in the actual flat as well.

Is this legal?

Showing a sample flat is permitted according to law.  So, if you want to prove that there was a difference between the sample flat and the actual flat, evidence is needed.  Most buyers do not have any documentary proof of the sample flat.  Photography or videos in most projects is prohibited.  After the project is sold out, the actual sample flat is demolished before possession.  In most agreements, there is a clause, which mentions that the final design may vary subject to approvals.  This indicates that the developer has the right to change or alter it without prior intimation.  Keeping this in mind, the onus lies on the buyer to do extensive research and due-diligence before making any investments.

குடும்ப சொத்துக்களை நிர்வகிக்க அறக்கட்டளை ஏற்படுத்துவதில் கவனிக்க வேண்டியவை

 குடும்ப சொத்துக்களை நிர்வகிக்க அறக்கட்டளை ஏற்படுத்துவதில் கவனிக்க வேண்டியவை!

    தமிழகத்தில் சமீபகாலமாக பல்வேறு பெரிய கல்வி நிறுவனங்கள், தனியார் நிறுவனங்கள் துவங்கப்பட்டுள்ளன.  இவற்றின் பின்னணியில் பல கோடி ரூபாய் மதிப்பிலான அசையா சொத்துக்கள் உள்ளன.

    இந்த சொத்துக்களை அந்த நிறுவனங்கள் அறக்கட்டளை வாயிலாக நிர்வகிக்கின்றன.  பெரிய அளவிலான நிறுவனங்கள் நடத்துவோர் மட்டுமே அறக்கட்டளை வைத்து இருக்க முடியும் என்பதில்லை.

    குறைந்த அளவில் சொத்துக்கள் இருந்தாலும் அதை அறக்கட்டளை ஏற்படுத்தி நிர்வகிக்கலாம்.  குறிப்பாக, சொத்துக்களை  நிர்வகிப்பதில் அறக்கட்டளைகள் மிக முக்கிய வழிமுறையாக உள்ளது.

    இதற்கான வழிமுறைகளை மக்கள் தெரிந்துக்கொள்ள வேண்டும்.  பொதுவாக, குடும்பத்தில் சொத்துக்களை வாரிசுகள் தங்களுக்குள் பல்வேறு பாகங்களாக பிரித்துக் கொள்வதே வழக்கமாக உள்ளது.

   இதில் சில சொத்துக்களை பாகம் பிரிப்பதால் யாருக்கும் பலன் இல்லை என்ற நிலை ஏற்படும் போது, அதை நிர்வகிப்பதில் அறக்கட்டளை ஏற்படுத்துவது சிறந்த வழிமுறையாக இருக்கும்.

     மேலும், அந்த சொத்தை சம்பாதித்தவர் நினைவாக சமூக பணி செய்யவும் அறக்கட்டளை சிறந்த வாய்ப்பாக அமையும்.

     தந்தை சம்பாதித்த சொத்தை நிர்வகிக்க அறக்கட்டளை ஏற்படுத்துவதாக இருந்தால், அதை எப்போது செய்கிறீர்கள் என்பது முக்கியம்.  தந்தையின் சொத்துக்கு வாரிசுகளான மகன்கள் மட்டும் ஒன்று சேர்ந்து அறக்கட்டளை ஏற்படுத்துவது சரியல்ல.

     தந்தை உயிரோடு இருக்கும் நிலையில், அவரும் அதற்கு ஒரு உரிமைதாரராக இருப்பார்.  இத்தகைய சூழலில் அவரை தவிர்த்து அறக்கட்டளை ஏற்படுத்துவது சட்ட ரீதியாக குழப்பங்களை ஏற்படுத்தும்.

       சிலர் தங்கள் காலத்துக்குப் பின் இந்த சொத்துக்கள் இன்னப் பணிக்கான அறக்கட்டளையாக நிர்வகிக்கப்பட வேண்டும் என குறிப்பிட்டு இருப்பார்கள்.  இதன் அடிப்படையில், அவர் காலத்துக்குப் பின் வாரிசுகள் அறக்கட்டளைகளை ஏற்படுத்துவார்கள்.  இவ்வாறு துவங்கப்படும் அறக்கட்டளைகளை பெயருக்கு அந்த சொத்துக்களை பெயர் மாற்றம் செய்ய வேண்டும்.  அறக்கட்டளையை உருவாக்குபவர், நிர்வாகிகளாக யார் யார் இருக்க வேண்டும் என்பதை நீங்களே முடிவு செய்யலாம்.

       சட்ட விதிகளுக்கு உட்பட்டு அதை முறையாக பதிவு செய்ய வேண்டும்.  இதில் பயனாளிகள் யார் என்பதையும் பதிவு நிலையிலேயே தெளிவுபடுத்த வேண்டும்.

        மேலும், அறக்கட்டளை பெயருக்கு மாற்றப்பட வேண்டிய சொத்துக்கள், அதை நிதிவகிக்கும் அதிகாரம் தொடர்பான விஷயங்களையும் தெளிவுபடுத்திக்கொள்ள வேண்டும் என்கின்றனர் பதிவுத்துறை அதிகாரிகள்.

Here's how you can calculate the fair market value of a property

 Here's how you can calculate the fair market value of a property

        Concerned if you are paying the right amount for the home you are planning to buy?  

If you want to buy one kg of apples, you will go to the market, check out the prices don’t vary significantly from one fruit seller to the other and the rates are generally in the same price bracket.  And this is how most purchases function, unless, you are buying a home.

    When buying a house, the stakes are much higher-we are now talking big numbers (in lakhs and crores).  The price point of two adjoining apartments could also vary significantly, depending on the size, amenities, view from the house, parking spaces, and the upkeep of the house; in such a situation, how does a homebuyer confirm if the house they are purchasing is at a fair price?

Ready Reckoner (RR) rate to the rescue

 Ready Reckoner (RR) rate also known as circle rate or guidance value, is the minimum price decided by the state government as a guidance for a property transaction.  These rates are revised by the state government periodically and give an insight to buyers and developers of the minimum value of their property.  This covers all immovable properties such as land, commercial, residential, as well as industrial properties.  “The rate is decided based on various factors, from land use to price movement and market conditions.  Properties are generally sold at market value, which is generally more than the RR rates.  The market value and RR rate together play a vital role in determining the stamp duty and registration charges, as well as the capital gain and property tax applicable for the property.

      The RR rates also come in handy in determining and tracking property prices over the years and appreciation potential.  While it may not provide an accurate market value, it does give a fair understanding of the minimum property value.  Homebuyers can thus refer to it and understand how much and at what pace their property could appreciate in the future.

Tax implications

The RR rate is used to evaluate the minimum value of the stamp duty and the registration charges.  “If an asset is transacted at a value that is higher than the RR rate, then the stamp duty and registration charges are calculated on the actual price.  However, if the transacted value is lower, then the stamp duty and registration charges are to be paid according to the ready reckoner rate,” .

      However, to ease the pressure on both, home-buyers and sellers, various state governments have given some relaxations - generally ranging between five and 15 per cent.

     

 “A difference of more than 10 per cent (or the relaxation permitted in the state) between the RR rate and agreement values of property translates into tax penalties under section 43CA of the Income Tax Act, 1961.  In case the market value is lower than the ready reckoner value, buyers have to pay higher stamp duty because stamp duty is always calculated on the ready reckoner value in such cases.  On the other hand, the seller’s tax liability goes up substantially and tax must be paid, on the notional gain

      “Post the pandemic-led economic slowdown, many properties were seen to be sold for distress.  In such cases, the tax implications become a burden for the seller.  Also, a wide gap between the fair market rate and the  ready reckoner rate at times leads to delays in structuring the transaction”.

Here is why you should consult a lawyer before buying a house

 Here is why you should consult a lawyer before buying a house

      Purchase a property that not only meets your requirements but is also legally approved so that you do not get into trouble later on

       In a bid to save some money, a homebuyer generally avoids appointing legal aid at an early stage.  However, is that a wise decision? At what stage should you introduce your personal, trusted lawyer?

Before booking a home

  Yes, that’s right, you need to consult a lawyer before even book your home.  Once you have visited the project and finalised your home, it is to talk to your lawyer.

  “The buyer would be enticed with several offers and discounts for on-the-spot booking; however, one should avoid it.  Gather as much detail about the project and show them to your lawyer, including the design plan, and project documents.  You may also consult an architect to verify if the project is of sound quality.”

So what is it you should look for?

. If you are buying a resale home, ask if the society will give you a NOC for the flat.  The chairman of the society will let you know if there are any overdue penalties/fines/maintenance charges for the flat you are buying;

.     Run the project by a bank, talk to your relationship manager, and ask them if you will be able to get a home loan (especially if the project is newly built or under construction) ;

  .      Check the track record of the developer, talk to people you know who have bought a home in other projects by the same developer;

    .     Run the project number through the RERA website and see if the project is indeed registered with RERA  and is safe to invest in.

                                                                                                                              

Sale agreement

Your sale agreement is a sacred document; it has all the details, along with the terms and conditions.  What you mention in the agreement will be ultimate and stand true in a court of law.  Thus, always run the agreement through your lawyer.

           “Sometimes, not often, developers fail to mention the date of completion, this is crucial and homebuyers should insist on it.  A layman may not notice this, but a lawyer would promptly point it out.  There might be an oral confirmation of the year, but there needs to be some kind of literature where the developer has committed to a date.  Sometimes this ambiguity becomes an issue for you in the court as there is no official promise made by the developer or it has not been mentioned in any document”.

During delays

“If the possession is delayed, immediately consult a lawyer.”

What can you do in case of a delay in delivery?

.     Approach the court: You can either file a complaint with RERA or with a consumer or criminal court depending on the case;

.       It cannot take more than three to four years for the lawyer to fight your case and get you either the money or the property;

 .        You must get a Completion Certificate (CC): Make sure that you get a CC from the developer when he does hand over a project after delays”.

What words should you look out for?      

 .         “Title:    Check if the title is ‘clear and marketable’. This tells you if there are any legal problems with the land or the project;

  .             Standard agreement:  Look out for words like “Standard Agreement” in your agreement.  Many times, there are terms and conditions that are added when the word standard agreement is missing.  For eg. you might not have any say if the property goes in for redevelopment; your right for the future FSI might remain with the developer and you won’t have the Transferrable Development Rights (TDR)”.

Thanks

 - TIMES PROPERTY

Here are some top tips to invest wisely

 Here are some top tips to invest wisely

As people gear up to purchase property before the increase in prices, here are some handy tips listed by experts that will prove to be useful for buyers

      Among the many ways in which the pandemic influenced consumers, it also reiterated the need to invest wisely to ensure financial stability.  This inadvertently revived a desire to commit to valuable assets, including real estate.  According to sales data revealed by a leading real estate services company, buyers’ interest is shifting from affordable housing (priced under rs 40 lakh) to mid-end (Rs 40 to Rs 80 lakh) and high-end homes (Rs 80 lakh to Rs 1.5 crore).

. Greater awareness among buyers

Compared to a few years before, home-buyers are now empowered to make better choices.  They have become more discerning and aware of their needs.  “The demand for spacious second homes amidst nature is soaring.  Prospective homebuyers continue to prefer bigger homes, better amenities, and attractive pricing.  Meanwhile, the commercial real estate segment is also performing well as millennials and NRIs are increasingly investing in properties, thereby redefining India’s housing segment”.

      The positive evolution of the real estate sector through regulatory changes like the establishment of RERA (Real Estate Regulatory Authority) has instilled better confidence among investors and transformed their perception of property ownership.  “Today, homebuyers are in a better space for investing as they enjoy augmented legal and regulatory protection.  Moreover, the right products are now available at the right price, thus creating better prospects for the buyers”.

 .   Financial planning is a must

Buyers must seek to make the most of the factors in their favor, especially when it comes to financing their property.  “Ease of availing home loans, and special financing offers from developers, banks and other financial institutions assist homebuyers in arriving at their best choice effortlessly”.

         By gauging these options, buyers can conveniently draw up a budgeting plan for their property before coming to the negotiation table.

Moreover, buyers must also take stock of tax-saving measures as “Looking closely into taxation is imperative for homebuyers as the Income-tax Act, 1961 has many provisions for homebuying-related deductions.  For instance, there are several tax deductions in store for first-time buyers on the interest and principal amount of their home loan.”

.        Assess all the relevant factors

Buyers must understand why choosing the right location for their property is paramount.  “Scouting an appropriate location that shows scope for development and appreciation in value over time must be a priority.  Additionally, it is vital to see the traffic situation and whether the location is well connected to the city”.

      A gamut of infrastructural projects in the area makes many erstwhile over-looked regions lucrative for investment.  Metro projects, new airports, increased bus connectivity etc; all make for a lucrative buying market.

       Moreover, exceptional connectivity, proximity to nature, and abundance of scenic and open surroundings make an area an attractive prospect among homebuyers.  “Such growth-driven locations are set to become the most coveted communities for real estate investors, especially in the segments of affordable buying and second homes.  And so, buyers should strike while the iron is hot and invest soon”.

         Not to forget, it’s equally important to make certain that the developer or the seller is trustworthy.  Besides the project’s registration with RERA, buyers must also investigate the goodwill of the buyer.  “Many builders construct houses that appear attractive, but the quality of material used in construction is poor.  And so, a detailed background check on the developer is necessary.  No query can be too trivial, whether it’s about certifications or amenities”.

          Considering the wealth of information and resources easily accessible to buyers, they are truly empowered to make thoughtful and rewarding investments.

Thanks - TIMES PROPERTY

Have you made your will yet

 Have you made your will yet?

      The demise of a property owner can lead to a legal tussle among family members in the absence of a Will.  Let’s delve into the types of successions available to you

         The transfer of immovable property after the death of its legal owner can turn into a legal mess with several complexities and a ton of paperwork.  Has he made a Will?, is the first question doing the rounds, eventually leading to a legal tussle between inheritors.  There are mainly two types of succession after the demise of an owner: intestate succession, and testamentary succession.  In this article, we will have a look at what these two types of successions entail as per the Hindu Succession Act 1956.

Types of succession

Let’s begin with the easy one, testamentary succession.  This is when a Will is prepared, and succession is followed as per the Will.

       According to section 2 (h) of the Indian Succession Act 1925, a  Will is the legal declaration of the intention of a testator concerning his property, which he desires to be carried into effect after his death.   “A Will is a legal document wherein the owner of a concerned property declares how much and to whom his/her property needs to be divided after his death.  A rightful property owner should mention all the necessary details in his Will.”

       Inheriting property through a Will is surely a hassle-free way as the owner has willed his property to you out of choice.   “There is no format for preparation of a Will.  A  Will can be typed or handwritten but needs to be attested by two or more witnesses.  The clauses of a Will should be clear and unambitious.  A Will is not required to be compulsorily registered as per the provisions of the Indian Registration Act 1908.”  However, “A registered Will is airtight and helps in case of any legal disputes like challenges to your inheritance by any heirs,“.

        If you come under the Hindu Succession Act, you can bequeath the property to any person through a Will, even if the person is not your relative.  You can also make amendments to your Will anytime.  However, the last amended  Will is considered the final one and used for execution. “For the change of title in the property, the Will has to be probated within six months of the owner’s demise.  Probate means that the Will has to be sanctioned by the court.  Interestingly, all of this is applicable if you have willed the property earned by you as it is your hard-earned property and asset. 

In the case of ancestral property, even if you will it to a certain heir, other legal heirs can challenge the same in court.”

   The second type of succession is intestate succession, which is done in the absence of a Will.

        Hindus, including Jains, Sikhs, and Buddhists are governed by the Hindu Succession Act, 1956.  Therefore, if a person belonging to any of the above religions does not leave behind a Will, the legal heirs will inherit the property according to the Hindu Succession Act, 1956.  “In case of intestate succession, the property devolves upon the class-one legal heirs.  In the event where there are no class-one legal heirs, then the property goes to class-two legal heirs in the case of Hindus, and people governed by the Hindu Succession Act 1956.”

  .    Class-one legal heirs include close relatives like spouse, children, and parents;

   .    Class-two legal heirs include grandchildren, etc.

           When it comes to the division of shares, children (sons and daughters), and spouses will have an equal share.   “If a person dies and is survived by a wife and two kids and no parents, into three parts among his kids and wife.  These three members can later divide the property with mutual consent if they wish to do so.  However, as per the Hindu Succession Act 1956, all three of them are entitled to equal parts.”  In case they want to decide the share amongst themselves, then, “A succession certificate /affidavits/No objection Certificates from legal heirs may be required depending on either religion/beneficiary/nature of the asset and/or depending on the facts and circumstances of each case”.

            Therefore, to avoid any disputes in the family after your demise, it is advised that you should get a Will prepared and registered.  It not only avoids any dispute but also ensures proper distribution of your property as per your wish.

New home vs Resale home: which better for you

 New home vs Resale home: which better for you

"I bought a resale kitchen home back in 2016 in Borivali, Mumbai for around Rs 55.5 lakh (including stamp duty, registration fee, and other overhead charges). The house was well-maintained, so I only had to do a few minor repairs and change the paint of the house. I wanted to invest in real estate, but couldn't find a home that fits my budget in any of the newly constructed buildings. Hence, I purchased a resale home. Now, in a few years, this building shall be redeveloped, and I will get a new, bigger home, at very little extra cost," 

"Buying a new home in an under-construction project gives you time to accumulate money and make the payment accordingly. Other than that, a brand new home comes with several modern amenities, especially if one invests in gated communities/complex-style projects."

So, if you are looking to buy a home but unsure whether you should buy a new home or a resale property, then read on as we analyze the pros and cons of each option, to help you get clarity.

In the case of brand new home

• Adherence to building norms: Other than the fact that the home is brand new, newer constructions also adhere to the latest building norms, codes, and standards, which can provide greater energy efficiency and safety;
• Customisation options: If buying an under-construction home, you can request the developer to customize your home (generally, at an additional charge);
• Lifestyle amenities: A new project is likely to offer a variety of. well-planned indoor and outdoor lifestyle amenities such as playground, swimming pool, sports court, gym, mini theater, banquet hall, business center, etc. In addition to that, these homes may also offer high-end safety and security features such as smart home automation, energy-efficient appliances, and modern fixtures.

The disadvantages of buying a new home:

• In the case of under-construction projects, buyers cannot move in immediately. Also, the buyer would have to complete the interior decor work before moving in, this can delay the move. If the builder is not providing a furnished home, you may have to factor in this expense as well. As per the prevalent benchmarks, fit-out cost for a residential unit can range from Rs 1,200-2,000 per sq ft;
• Upkeep and maintenance of the society or the building premises can- not be ascertained;
• It is not possible to check in case of any issues such as seepage or leakage within the unit.

In the case of resale flat

The key advantage of purchasing a home from the secondary market is that you can get possession of the flat immediately. Also, the seller is more than willing to negotiate on the price tag," says Niranjan Hiranandani, national vice-chairman, NAREDCO.

Jhunjhunwala further mentions, "A buyer can ascertain the society premises, its upkeep and maintenance. Also, any underlying issues pertaining to the development, or the unit can be ascertained."

"Resale homes are often located in established neighborhoods with mature trees, established infrastructure, and surrounded by amenities such as schools, shopping centers, and transportation. This can be a great advantage for buyers as it enables convenience. It is also crucial for those who wish to buy a home at a specific location. The outgoing costs (such as society maintenance) are also lower as compared to the newly constructed homes," elaborates Mody.

The drawback of buying a resale home

• Dated home models: Resale homes may have outdated home layouts. They also come with old appliances, outdated electrical and plumbing systems, or old heating and cooling systems. This can be costly to update and may not be energy efficient;
• Maintenance costs: Resale homes may require more maintenance and repairs than the new homes due to the wear and tear. This can add up to substantial costs over time and may be unexpected.