Checklist of Things to do Before Buying an Apartment from a Builder
According to an article published by Forbes, 2017 is going to be a bumper year for India when it comes to real estate, since the country is in the top of the list of preferred destinations for real estate investment in the eyes of major institutional investors. With the maturing finance industry and repeated interest rate cuts by the central bank, Indians have almost perfect conditions for property purchases. Buying an apartment, the dream of many, is exciting, but also one of the most challenging tasks, because of the many pitfalls involved in the process. Let us take a look at what all you need to make sure when buying an apartment from a builder.
Things to Look For in the Apartment
Once you’ve identified the apartment that you are interested in buying, make sure you get the floor plan of your apartment and calculate the carpet area, i.e., the area enclosed within walls. Look for the inside and outside wall finish, appropriate floorings, especially in the bathroom and kitchen, child-safe electrical fittings of a reputed brand, good quality doors providing easy access, wide windows allowing enough light and air into the rooms, cross-ventilation for better circulation of air, sufficient ceiling height and provision for AC fitting.
What to Look For in a Builder
It is always advisable to go with a builder who has an established presence in the market. Look for their previous work and the quality of the apartments to establish their reputation. You can visit buildings already constructed by the same builder to decide upon the quality standards followed by the particular builder. Ask for certain paperwork to determine if the builder is legally sound, including their commencement certificate for the project you are interested in as well.
Questions You Should Ask the Builder
- Track Record:
Ask the builder regarding the details of projects completed by them and how much time they took to complete each project. Most importantly, you need to ask whether they received the completion or occupancy certificates for completed projects or not, along with the number of flats sold.
- Status of Property Title:
You can guarantee the title by making sure that the builder has bought the land and constructed on it. Don’t fall for a builder’s Joint Development Agreement with Landowners, which has numerous legal flaws, mostly unintentional, of course.
- Commercial Rights Retained by the Builder in the Project:
Although it is mentioned in the agreement with the builder, you should check for builder’s commercial rights before making the payment of the booking amount.
- Copy of Agreement:
Legally, it is your right to ask for a copy of the agreement, which most builders are hesitant to share before the complete payment is made. Once you have paid the booking amount, the builder will not listen to you for the same. As a matter of fact, most agreements are heavily in favour of the builder, where you might not be left with any other option but to agree.
- Average Price of the Property:
It is essential to ask for the average price from the builder, since there is no fixed price for any property.
- Deviation from Approved Layout Plan:
Ask for a tentative deviation from approved layout plan, which in most cases the builder does not disclose.
- Payment Schedule:
Asking for the payment schedule from builder, beforehand, will save you from any surprises in future, since many buyers find payment schedules impossible to follow with tight timelines.
It would be wise to ask for the master set of project documents for future reference, which many builder provide in CD / DVD form. Buyers are sometimes compelled to choose a home loan provider who has already approved the project, since builder set stiff timelines so that buyers will not have time to approach any other bank. Builders do that to receive a commission from the home loan provider. However, this becomes unfavourable for the buyer, since in this process, the buyer does not gain access to most of the critical project documents.
To buy an apartment at the best rate, do not go by what the broker tells you. Other than the basic cost, count in other factors, such as preferential location charges, internal and external development fees, parking, club and statutory charges, and service tax. All of this will escalate the total cost.
Hi, Mani Karthik here. Having lived in USA, India & Middle East, and worked for big MNC’s to startups, I have a lot to share with you. My aim is to help people, by sharing everything I’ve learned in life, through this blog. It’s read today by more than 150K people world over! I currently live in LA, California and visit India occasionally. Here’s my full story on who I am and why I blog. Connect with me on FB, Instagram, Twitter or WhatsApp (+001-408-489-4785). Happy to help! 🙂