What to ask before you buy a flat

*"**What to ask the real estate developers?* *"*


*Like any another purchase, buying a property has its own confusions and
risks during decision making. A home buyer has to be sure that he/she
chooses the right builder and the right location within the right price.
From a personal point of view, every buyer does his/her best to verify the
property and have the best pick; however, we still see a lot of cases
wherein the buyer is duped and is eventually dissatisfied by the purchase.
Following the customer feedback, in this article, lists a few questions
that you can ask the real estate developers and then shortlist the
property.*


*Use of land*


*What is the use of the land on which the project is being developed? Is it
for residential or commercial property; floors or plots; how many floors
does it permit etc. It has been seen that often developers begin a project
and start to sell properties before land acquisition is over. A portion of
the land acquisition may be pending and might impact your apartment;
therefore, make sure to ask the developer and verify the land acquisition
documents. A home buyer should verify the papers demonstrating the
builder’s ownership of the land. You could also hire a lawyer to conduct
the title search and to find out whether there is a legal dispute over the
land.*



*What about the approvals?*


*A home buyer should check all the approval documents prior to finalizing
the deal. Check for the developer’s licence in order to check the
permission from the area’s town planning authority to develop the project
and approvals for building plan, water, environment and pollution, and
height clearance. If the approvals have not obtained, it is suggested that
a home buyer should not invest in that project as delay in approvals is of
the major causes of project delays. *


*Payment Plan*


*In the application form, pay attention to the payment plan. One should not
pay a large portion of the cost of the property at initial stages. It is
suggested that one should stick to a construction-linked payment plan or
one in which a portion of the cost has to be paid after possession. Another
area of concern is that the builders often include a cost-escalation clause
in the builder-buyer agreement, which states that the developer has the
right to increase the cost of the project in case the cost of building
materials goes up. Enquiries regarding the builder’s track record as to
whether he has implemented the escalation clause in the past can be made or
finalise a developer who does not include an escalation clause in the
agreement.*


*Delivery and its terms*


*Most of the agreements mention a time frame within which the developer
will give the possession of the property; however, the trick is that the
agreements do not mention the start date of the time frame. Enquire about
the start date and if possible get it documented. Also check whether the
agreement has a penalty clause under which in case of a delay in
possession, the developer will have to pay a penalty to the buyer. If the
clause is there, find out how much penalty he will pay and whether he has
paid it in the past.*


*Change in layout plan*


*Often builders bring about changes in the layout plan and show them as
beneficial for the buyer; however, the buyer should not be lured by the
increase in area of the property, instead at the time of booking, should
find out whether the builder has changed his plans in the past and what
were the terms of that. For example, if the area of the property increases,
the buyer will have to pay according to the original booking amount or the
current rate?*


*The extra charges*


*Check out the various heads under which the developer may ask the home
buyers to pay, for example, preferential location charges (PLCs), external
and internal development charges (EDC and IDC), advance maintenance fee
etc. Calculate what will be the purchase value after adding all these
charges and buy only if the sum falls within budget. There can also be a
case when the buyer falls behind in paying an installment; in that case the
buyer should be clear about whether the developer will give extra time to
pay up, what will be interest liability etc.*


*Record of the developer*


*The record of the developer includes his financial status and his
reputation as a developer. The buyer can verify a developer’s financial
status by asking for his company’s balance sheet. Do not invest in the
project if his company is over-leveraged because it increases the
probability of delay in project completion. Moreover, find out how many
projects the developer has completed, whether there were legal issues in
his past projects, whether the projects were delayed, are the current
occupants satisfied with the construction etc.*


*Source : Makaan Research Team*