Resale Flats may be Cheaper, Hassle-free
A resale property will cost 10% less than a new one, and you will get what you see. But, you will need to do proper due diligence
PRASHANT MAHESH
House hunters are getting adventurous once again. The news of price corrections in smaller cities and some pockets in major cities has prompted some of them — browbeaten by the rise in both prices and interest rates and out of the market for a while — to restart the process of hunting for a house all over again.
The search for a house can be tricky, especially when real estate agents show flats that are for resale along with new ones in apartments that are just about to be completed or have just been completed.
And guess what, the resale flat, which may be in perfect condition, would be at least 10% cheaper than the newly-constructed flat — a valid enough reason to make most individuals wrestle with the choice of settling for a cheaper, old place or a brand new, slightly expensive home.
Saving 10% is a huge relief when the prices are astronomical and interest rates are hovering around double digits.
“Buying a resale property can be a prudent choice, provided you do your due diligence well,” says Rajev B Sharma, country head, Unicon Financial Intermediaries.
The biggest advantage of a resale property is that you can move in immediately. The carpet area may be higher and there would be better clarity on your cash outflows. Last but not the least, you get what you see.
With an under-construction property, the end product may not be what is promised to you. There have been several instances of builders promising to complete the project in a particular period, but failing to stick to the deadline. Also, there have been instances of buyers being cheated on the carpet area.
Such things would take a toll on your finances as well as your mental health.
“There is no delay in construction, service tax or VAT in a resale property, issues you could face while buying an under-construction property,” says K Ramalingam, director, Holistic Financial Planners.
If these factors appeal to you, you can take a serious look at resale properties.
ENGAGE A GOOD BROKER, LAWYER There is a stark difference in how you buy a new property and a resale property.
New properties are generally sold by developers, who have offices to facilitate such sales. But, to locate a resale property, you need a real estate agent. Hence, start by hiring a good real estate agent. Agents are localised and are experts in their respective areas. They will tell you at what prices recent transactions have happened. They will also guide you on the finer aspects, like the water supply, transport system and the type of gentry that resides in the locality.
Very often, the agent also helps you with the paperwork, including registration of your property and payment of stamp duty. Of course, real estate agents will charge you a fee once the transaction is done.
The fee, which is negotiable and depends on the quality of services, in usually in the range of 1% to 1.5% of the transaction value. “A good lawyer and real estate agent will ensure that your paper work is in order, which is very important, especially in case of resale flats” says Akshaya Kumar, MD, Park Lane Property Advisors.
CLEAR TITLE This is one of the most important things you should check out. “This is the single-most important thing to check if one is buying a resale property,” says Akshaya Kumar.
One also needs to check the entire history of agreements pertaining to that property.
“Documents relating to that sale going back to the very first purchase from the original developer will be needed in original,” says Rajev Sharma.
Always insist on the ‘chain of documents’ — all the agreements effecting ‘buying and selling of property’ till date since it was constructed. If you were to go for a housing loan, the bank will insist on all the documents, failing which your home loan may not go through. So if you are going for a loan from a bank, before paying the token amount, do ask for all documents.
ALL CLEAR FROM HOUSING SOCIETY If a property is for resale, then it usually is part of a building managed by a society. You need to check if the seller has cleared his dues to the society.
“To avail a loan, you will need a no-objection certificate (NoC) from the society, which will be issued only when all the dues are clear,” says Gulam Zia, national director, research and advisory services, Knight Frank.
If the building is old and the society is collecting extra funds for maintenance purposes, then you ought to factor that in while making your purchasing decision. It would be wise to meet an officebearer of the society to make sure that things are in order.
In addition, one needs to check if the electricity bills, phone bills and all other utility bills have been paid till the time you have taken possession of the property. Check out things like the plumbing and the quality of wiring in the flat.
If you need to rewire the house again, that might drill quite a hole in your pocket. If you have a vehicle, check for parking space. Today, in metro cities, parking comes for a high cost.
Many a time, a flat owner eager to sell the property may tell you that parking is not a problem. However, when you move in, you may find it to be otherwise. You may be forced to buy a parking space or may not get space to park your vehicle.
Also, in cities like Mumbai, redevelopment is a common activity. It is better to check if the old building is considering any redevelopment proposal and study its implications before purchasing a flat in such an old building.
Find out what the redevelopment agreement seeks: for instance, whether the old owners of flats will be paid or given flats in the new building to be built. You stand in a difficult position if you were to use the flat to stay in. Though you can always oppose such a proposal, it will not be in your best interest.
All in all, if you want value for money and want to move in fast, it does make sense to consider a resale property.
prashant.mahesh@timesgroup.com
Monday
How Promoter Activity can be a Gauge of Company’s Performance
Resale Flats may be Cheaper, Hassle-free
A resale property will cost 10% less than a new one, and you will get what you see. But, you will need to do proper due diligence
PRASHANT MAHESH
House hunters are getting adventurous once again. The news of price corrections in smaller cities and some pockets in major cities has prompted some of them — browbeaten by the rise in both prices and interest rates and out of the market for a while — to restart the process of hunting for a house all over again.
The search for a house can be tricky, especially when real estate agents show flats that are for resale along with new ones in apartments that are just about to be completed or have just been completed.
And guess what, the resale flat, which may be in perfect condition, would be at least 10% cheaper than the newly-constructed flat — a valid enough reason to make most individuals wrestle with the choice of settling for a cheaper, old place or a brand new, slightly expensive home.
Saving 10% is a huge relief when the prices are astronomical and interest rates are hovering around double digits.
“Buying a resale property can be a prudent choice, provided you do your due diligence well,” says Rajev B Sharma, country head, Unicon Financial Intermediaries.
The biggest advantage of a resale property is that you can move in immediately. The carpet area may be higher and there would be better clarity on your cash outflows. Last but not the least, you get what you see.
With an under-construction property, the end product may not be what is promised to you. There have been several instances of builders promising to complete the project in a particular period, but failing to stick to the deadline. Also, there have been instances of buyers being cheated on the carpet area.
Such things would take a toll on your finances as well as your mental health.
“There is no delay in construction, service tax or VAT in a resale property, issues you could face while buying an under-construction property,” says K Ramalingam, director, Holistic Financial Planners.
If these factors appeal to you, you can take a serious look at resale properties.
ENGAGE A GOOD BROKER, LAWYER There is a stark difference in how you buy a new property and a resale property.
New properties are generally sold by developers, who have offices to facilitate such sales. But, to locate a resale property, you need a real estate agent. Hence, start by hiring a good real estate agent. Agents are localised and are experts in their respective areas. They will tell you at what prices recent transactions have happened. They will also guide you on the finer aspects, like the water supply, transport system and the type of gentry that resides in the locality.
Very often, the agent also helps you with the paperwork, including registration of your property and payment of stamp duty. Of course, real estate agents will charge you a fee once the transaction is done.
The fee, which is negotiable and depends on the quality of services, in usually in the range of 1% to 1.5% of the transaction value. “A good lawyer and real estate agent will ensure that your paper work is in order, which is very important, especially in case of resale flats” says Akshaya Kumar, MD, Park Lane Property Advisors.
CLEAR TITLE This is one of the most important things you should check out. “This is the single-most important thing to check if one is buying a resale property,” says Akshaya Kumar.
One also needs to check the entire history of agreements pertaining to that property.
“Documents relating to that sale going back to the very first purchase from the original developer will be needed in original,” says Rajev Sharma.
Always insist on the ‘chain of documents’ — all the agreements effecting ‘buying and selling of property’ till date since it was constructed. If you were to go for a housing loan, the bank will insist on all the documents, failing which your home loan may not go through. So if you are going for a loan from a bank, before paying the token amount, do ask for all documents.
ALL CLEAR FROM HOUSING SOCIETY If a property is for resale, then it usually is part of a building managed by a society. You need to check if the seller has cleared his dues to the society.
“To avail a loan, you will need a no-objection certificate (NoC) from the society, which will be issued only when all the dues are clear,” says Gulam Zia, national director, research and advisory services, Knight Frank.
If the building is old and the society is collecting extra funds for maintenance purposes, then you ought to factor that in while making your purchasing decision. It would be wise to meet an officebearer of the society to make sure that things are in order.
In addition, one needs to check if the electricity bills, phone bills and all other utility bills have been paid till the time you have taken possession of the property. Check out things like the plumbing and the quality of wiring in the flat.
If you need to rewire the house again, that might drill quite a hole in your pocket. If you have a vehicle, check for parking space. Today, in metro cities, parking comes for a high cost.
Many a time, a flat owner eager to sell the property may tell you that parking is not a problem. However, when you move in, you may find it to be otherwise. You may be forced to buy a parking space or may not get space to park your vehicle.
Also, in cities like Mumbai, redevelopment is a common activity. It is better to check if the old building is considering any redevelopment proposal and study its implications before purchasing a flat in such an old building.
Find out what the redevelopment agreement seeks: for instance, whether the old owners of flats will be paid or given flats in the new building to be built. You stand in a difficult position if you were to use the flat to stay in. Though you can always oppose such a proposal, it will not be in your best interest.
All in all, if you want value for money and want to move in fast, it does make sense to consider a resale property.
prashant.mahesh@timesgroup.com
Monday
How Promoter Activity can be a Gauge of Company’s Performance
No comments:
Post a Comment