Moneycontrol
Source: Moneycontrol.com

Ten things to check before buying your dream home

Here is a list of factors that make your home a dream home

Ten things to check before buying your dream home

Avnish Yadav

Buying a property is an emotional decision for most home buyers in India. However, it is imperative to have a checklist in place before purchasing a property. Here are the 10 things to keep in mind for the home buyer.

1. Location: Location is the most important factor that determines the present and future valuation of the project. Before zeroing in on the property, the buyer should check the infrastructure development plan such as metro connectivity, bus, school, hyper market, hospital and commercial establishment. This helps the buyer/investor in visualizing livability in the area.

2. Choose a reputed developer: The buyer should conduct proper due diligence of the developer with respect to credibility in the market and strong financial position to deliver the project on time. Besides this, the buyer should conduct detailed verification of the developer related to necessary approvals, past performance and feedback on the projects delivered in the past.

3. Don't go by the sample flat and promises: Marketing and packaging are the two important factors that developers focus upon throughout the project life cycle. The buyer should ask for all documents pertaining to projects approvals such as title deed, encumbrance, land use, fire approvals, etc. Additionally, the buyer should ask for a detailed blueprint from the developer including cost related to first transfer, extra car parking, etc. in order to ensure that all the commitments are met at the time of possession.

4. Home loan: Generally, many developers tie-up with many financial institutions for hassle-free financing. It is mandatory for all financial institutions to conduct all legal checks and approvals before funding the project. This also helps the buyer to avail the home loan from such banks that have done thorough check of the property. Post checking the necessary approvals and finding the financial institution, the buyer should go-ahead with the one that offers the loan at the lowest rate.

5. Cost and clarity on taxes: The developer always try to promote the basic cost associated with the project whereas there are numerous charges that are part of the final cost of the property such as preferential location charge, car parking, external development charges, internal development charges, club, service tax and VAT. The buyer should check and negotiate with the developer in order to get the best price in the prevailing market conditions.

6. No future cost escalation: At the time of possession, developers realize that they had developed 20 sq ft to 100 sq ft more than the initial commitment, thus resulting in inflated property prices to recover the additional cost of the increased space. To avoid this situation, the buyer should take written commitment from the developer to avoid such additional cost in future.

7. Check the site plan: The layout of the property highlighted in the brochure could be different from the reality. As developers launch projects in stages, the buyer should check if there is any further development or new construction within the project. For instance, the green belt mentioned in the brochure can be developed into a new high rise building at a later stage. To avoid these misconceptions, the buyer should gain as much as information about the locality where he/she wants to invest in.

8. Resale potential: Before acquiring the property, the buyer/investor should evaluate the property from the resale perspective and its potential to attract investors in future. The buyer should aim for developed locality and growth prospects to ensure better return of investment.

9. Rental Opportunity: Many times, buyers give their property on rent and move to another location. In order to regret the purchase decision at a later stage, the buyer should conduct extensive research related to future development and rental opportunities of the place. While this may not be the sole deciding factor but should be kept in mind before acquiring the property.

10. Construction quality: The buyer should always ensure that the quality of building material is sound and secure before finalizing the buying decision. Although it is a technical aspect but frequent field visits to the project site and gaining insights from an experienced architect can help in checking the construction quality of the project.

The author is deputy general manager, Residential Services of Colliers International India
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