Internet has changed the basics of business. Gone are the days when you had to hunt for the broker to provide relevant information on property. Now you can visit any of the real estate portals and chances are that you will find the property of your choice. Most of these portals are loaded with information on property and they have team of qualified and efficient persons to help you with anything, right from identifying the property of your choice within your budget, legal advice, doing all the paper work that is required to arranging finance for the property. Buying a flat has never been so easy: a few clicks and you have what you are looking for.
But buying property still remains one of the most tedious jobs for most people. This is despite the fact that the market has some of the best options available ever. Although there are hundreds of builders in the market with good quality construction, a number of housing finance companies ready to finance your property with customised schemes to match your needs (step up, step down EMI), and a number of property exhibitions throughout the year, buying a "dream" house can turn into a nightmare for buyers who don’t do their homework properly.
Acquiring a property outright (and not on finance) means a major portion of your lifetime savings will be spent on acquisition of the house. If you are buying it via finance (which is a better option even if you have money to buy outright) you end up servicing debt for years. With so much at stake it becomes even important for us to do some serious homework before finalising the deal.
To make the best of the prevailing conditions in the property market, let’s try and understand what we should look at while locking the property deal to avoid misery in future.
Property checklist:
Correct title deed of the land where the building is to be constructed.
Approved details of the building plans and the progress of the work in line with the approved plan.
Past track record of the builder in delivering on time
Construction material used by the builders for construction and its proportion
Stamp duty and registration charges and how difficult it would be to get it done.
Remedies available to a prospective purchaser against a troublesome builder, if the project is delayed or there is cost overrun.
Always make sure that issues like the title deed of the land, the approvals, the plans and area of the flat are covered in the agreement. Insist for the copies of the approved plans and the title papers, attach the copies of these documents with the agreements paper.
The unforgivable mistake a buyer does while buying the flat is getting carried away by the glossy brochures showing colorful granite flooring and promising world-class amenities and ignoring the fundamentals of construction. But the basic aspects of construction, involving a proper cement-water ratio, sand, and solid steel is something buyers should inquire with the builders. Construction is something buyers need to give topmost priority, rather than worry about tiling, etc. Weak construction is only identified when it is too late. Only the builders of repute and experience can be trusted to handle the project without too much inquiry.
Untill recently there was no gradation system for builders and their projects. Just about anybody could become a builder thereby overcrowding the industry. But with the construction industry acquiring an industry status, credit rating agencies like CRISIL and ICRA are now planning to award rating to the housing project and builders. The rating is expected to cover all aspects and would be freely available to all the participants of the industry. The ratings are expected to be of great use to all participants in the industry - buyers, project financiers and builders.
Most housing finance companies now release the approval list of projects and builders on a regular basis for their loans. This list addresses most of the points mentioned above with regards to construction. Approval of the project is a pointer to the builder’s reputation.
There seems to be little doubt that the real estate market at present is tilted in favour of the buyer. Housing finance companies are offering loans at low interest rates and even real estate prices have come down considerably over the last couple of years. It’s time to act and get the most out of the present market conditions.
