Legal checklist while buying a property
Investing in your long-yearned dream home is not just based on one single decision. It is an amalgamation of various factors which play an essential role in your hunt for the perfect haven. Family aspirations, personal motivations, financial limitations and prevalent policy and real estate norms - all of these impact your decision in one way or another. Choosing the right property is extremely important and to help make this decision easier for you, here are some pointers that you need to bear in mind before you make up your mind to invest in property.
Amenities provided:
Evaluate various aspects of the project like the master planning and amenities provided. Developers these days are getting international expertise to master plan their project and consumers can get a feel of it by going through the master plan.
Many projects these days focus a lot on sport and health based benefits. Features like Golf based themes, sports complex, health clubs, tennis courts and swimming pools are incorporated by many developers for the well being of consumers. Important features like 24/7 Power back up, security back up, shopping arcade, entertainment centers, etc are points that should be a part of your check-list.
Location of the project:
Location of a project is very important. The real estate development in the surrounding areas and the connectivity of the project to important centers in the city like school, hospital, bus and rail services, shopping complex, etc. is something the buyer should first look at before planning to invest.
Developer’s legal background:
Taking keen interest in knowing the legal background of the developer will help the buyer ensure that the developer has not been in any legal hassles.
Be aware of fly-by-night operators:
Investors must be wary about fly-by-night operators and even the more established players who are unable to fulfill their commitments to the buyers.
Financial stability of the developer:
The reason why you need to keep a track of the financial stability of the developer is because it determines the credibility that the developer enjoys in the market. Listed firms have an edge over other real estate companies as they are under the scanner of Securities and Exchange Board of India (SEBI).
They mandatorily follow principles and guidelines issued by SEBI and are required to submit financial statements. This allows customers to form their own perception of the developer. Due to better corporate governance and audited financial statements, such listed real estate firms have better chances of sourcing funds from financial institutions, provided they are performing well.
Transparency and accountability of the firm:
The state of a listed company is more visible to the buyer and it can help in taking a comprehensive investment decision. A listed firm provides higher transparency and accountability as its activities directly impact its share prices. Aspects such as financial leverage, delivery versus commitment, internal and external focus, etc should be carefully studied.
Regulatory approvals are in place:
Make sure that the title to the land that of the project and all the regulatory approvals are in place. This needs to be done irrespective of the nature, size and reputation of developer. The buyer should insist on verifying all documents pertaining to land title, approvals of building plans and commencement of construction. It is always a good idea for a group of buyers to get together and hire professional legal expertise to get due–diligence done.
Developer’s track record:
The track record of the developer in delivering projects is a key criterion while buying property. Amount of space delivered, timelines for delivery and quality of work produced is critical for the buyer to analyze. A developer with an impressive track record will surely deliver better than any other developer.
‘Tech-savvy’ developer:
With technology leading the way everywhere, a consumer is sure to enjoy more benefits if he chooses a tech savvy developer who is always implementing the latest technology in not just construction but but also in the various amenities provided to the consumer.The final investment decision of the customer should ideally be a combination of credibility of the company, an assessment of the project fundamentals and his understanding of the market situation.
- Mr. Ravi Saund, COO, CHD Developers Ltd
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