Saturday, 6 June 2015

Planning to buy a property? Know what to check

Manish Agarwal has been in Bengaluru for the last eight years. On our Q&A forum, Open House, he asks- I am planning on a property in an upcoming area. What checks should I go in for? How do I ensure that I am making a safe investment? Agarwal is not the only buyer with such a query. In fact, the buyer-seller market is so vast that you would need to mug up some tricks of the trade.

What are the odds you need to watch out for?

On your fingertips!

Approach the local authorities for a clearance. This will ensure that you were not tricked into buying something that you never intended to. For example, a non-agricultural land could be marked out by the authorities in a developmental plan.

There’s a new metro network planned in locality XYZ. Suddenly, you hear that capital values have started appreciating. As an investor you just can’t keep yourself away from such a hotspot. Do invest. However, do not look for quick returns. During the construction phase, values are often seen to be fluctuating as livability touches rock bottom when there is too much construction or hassles in commuting because of ongoing work. In the long run, the locality does benefit.

Has the developer marched that extra mile for his consumers? In the wake of natural disasters which has recently hit the country, do not hesitate to ask the developer the right question. In an earthquake prone zone for example, do ascertain whether the structure is quake proof and ask for documents maintained about soil conditions, foundation, etc.

Get assured returns, says developer A. It could be a prize catch! There could be chances that it can be otherwise too. Assured schemes may be genuine but you cannot be very sure. In all possibility, one needs to know what is at stake. For a high ticket price, the risk is higher too.

A lot of developers today are willing to offer construction linked payment plans or even subvention schemes. While there is no harm in opting for either, as a buyer, do the due diligence of checking whether the builder has the ability to provide you with such schemes. Go for credible developers who are not hard pressed for funds.

Buying a plot for higher returns? Great idea! However, plots yield in the long run. Stay invested for mid-long term for maximum gains. Avoid buying from unstructured sellers. Do not buy in areas that are not included in the master development plan.

Watch out for unauthorized constructions. Property options in such areas may be cheaper, may look fancier too, but property transactions could be risky in these cases. Update yourself with the latest talk that is happening with real estate circles.

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