By Ameet Mehta, Advocate & Solicitor
A home that is not the primary residence but is used as a vacation home. This home cannot be rented out, or it is considered an investment property. Investment in second home involves purchase, ownership management . Factors such as proximity to the work place, school, family and friends come onto play.
When you are buying a home, remember that “every decision you take is just your decision”. Common factors to look at while buying a new home.
It’s easier to get custom features:
You might be able to persuade the builder to change a few things before you move in. With an existing home, alterations are often negotiated with the seller. That can be uncomfortable as well. But with a new home in an unfinished neighborhood, the labor and materials are still on site, soits easier to execute. Builders are flexible and provide a greater range of choices in things such as appliances, flooring and paintetc
You could have additional options for financing:
Builders often work with banks and, as a result, may be able to offer better financing options. And you can always try to use the offer of builder financing to drive a better deal with your own lender.
It’s still a buyer’s market:
Shoppers are used to being in the driver’s seat when it comes to the price on a previously owned home. But that same market will also help them get a good deal on a new home. And that can help buyers negotiate a better price on a new home. With a new home, “you’re starting fresh, its economic life is longer, you get to personalize it, and you don’t have to undo what that other person thought was important.” You get the latest in technology and systems, “but there’s a cost involved in that.
Better infrastructure with your choice:
One gets good idea of available infrastructure like nearby groceries, shops, availability of household help, situation regarding water supply etc which matters more to the lady of the house.
Better possibility of maintenance:
One can see whether building is being maintained or not and the cost pertaining to the same.
Have a choice of neighbours:
You can very well see the neighbours. It might be good idea to just meet them and greet them even if for only little time. It gives good idea on what standard of living is maintained by residents and whether one can easily fit-in. There are some buildings where there is only one flat occupied on a floor, others being bought by “investors”. One can avoid possibility of living on a ghost floor by buying little old property.
Do not go for over-priced properties which are beyond your means. Do not be impressed by those fringe attractions that builders dole out to impress the potential buyers like club, swimming pool, golf course, gyms, landscaping and more important than these are the quality of construction and the basic facilities provided by the builder like earthquake-resistance (the richter scale it can withstand), the ratio of super area:built-in area, quality of material used within the apartment, 24 hr backup of electricity etc. If you can manage your cash flow by reducing some other expenses, go for a size which is bigger than required i.e you need 2 BHK for now, go for 3 BHK and so on.
This is important. Look for the development activities in the surrounding areas. If there are metros, malls, highways, office or commercial and residential building being constructed in the vicinity, such properties have the potential. Choosing a right property in a right location is like picking up a good stock. Buy when prices are low but has a potential to go up in the medium to long-term.
Legality of Land on which the new home is coming up:
The land on which the property is being constructed is not under any legal dispute and the papers are clean
Approvals in place:
Make sure the builder has taken all the necessary approvals from the municipal and other bodies required for the construction of property. Any slack here will delay the possession. Approvals such as IOD, CC, Occupation Certificate, Title Certificate, Plot ownership documents such as PR card, 7/ 12 extractsetc should be in place.
Previous track records:
Previous track record of the builder on the completion of projects on time. Most builders do not adhere to the schedules. Of course such a risk is not there when you are buying an already constructed property but they are more expensive.
Read Agreements Carefully:
Read Agreement carefully before signing it. Eventually, in the process of purchasing Flat we built mutual trust and the builder promises us amenities such as parkingetc, but this is not included in agreement. Hence try to take an advance copy before signing the agreement.
More carpet area: In most of the new construction the super-buildup to carpet area ratio is barely 60-65%. Hence check the combination
Ready to move property:
You can move into it right away, as against waiting for 2-3 yrs in case of newer construction. If you stay on rent then this can be an important consideration.
Occupancy Certificate and statutory approvals:
For ready to occupy building’s insist on occupancy letter which is issued by MCGM. This ensures the plan violations has been checked and regularized by authorities when the construction got over and it’s really ready to occupy.
Verify the documents with a legal Advocate
Don’t agree for any Oral Agreement, Never!