Factors To Consider While Buying Property

Buying property can be very difficult if you don’t adequately research into the factors governing it. The prime factors to consider while buying property are the neighbourhood, type of property, cost of property and possibility of future appreciation. The location of the property plays a vital role in deciding whether to purchase a property or not.

Factors considered while buying a property:

1.)    Location or connectivity

2.)    Infrastructure

3.)    Face value

4.)    Reliability of the developer

5.)    Safety

With most cities expanding to the nearby suburbs, it is important that you assess the connectivity to different areas. Not only should a neighbourhood be connected to other residential areas, but also, to the business centre of the city. Most cities in India are seeing a growth in connectivity via the improved state of Metro connections.

For instance, the connectivity between Ghatkopar and Versova has been improved manifold with the inauguration of the Metro railway in Mumbai.

Areas which are connected to the central business district and commercial hubs of the city at minimum drive time should be preferred by home seekers.

To live a comfortable life, certain amenities need to be available at the disposal of the resident. Proper roads, street light, sewerage and drainage, garbage disposal and electricity are some of the civic infrastructures that have to be in place in a neighborhood for its property market to take off.

Social infrastructure is equally important to make a neighborhood habitable. Home seekers prefer to buy flats and houses in those areas which have good schools, banks, ATMs, hospitals, shopping centres and health care facilities within walking distance. Every city has these areas where people prefer living in because of the ease of life offered by them.

A lot of buyers simply prefer purchasing properties in certain areas because it is in vogue to own properties there. For example, Golf Course Road and Golf Course Extension Road have senior VPs of companies and entrepreneurs living in plush apartments because it is the current trend in NCR. A lot of old families living in Mumbai prefer staying in their 1BHK apartment in Prabhadevi or Worli, because of the brand value of the place. The status associated with living in a neighborhood ften attracts home seekers, albeit for the wrong reasons.

Most people invest in real estate because of the prospects for future growth. If you are looking to buy property for the purpose of investment, then choose an area which has rapidly grown infrastructure and commercial centres as it would lead to a faster appreciation of prices in the real estate market.

Hidden costs in real estate purchases and how to avoid them

The common trend in housing real estate is that of gated residential communities which come with swimming pools, kids’ play areas, community halls and landscaped gardens for recreation etc. However, did you know that none of these amenities are available for free? Developers often include these costs in the cost of an apartment before offering a quotation to a buyer. There are quite a few hidden costs associated with properties in India that buyers must be aware of before going house-hunting.

Parking Space

Most builders charged between Rs 2 lakhs and Rs 5 lakhs for parking space within a residential community. This was a huge cause of ire among buyers and led to a lot of disagreements between developers and buyers. However, the Supreme Court ruled in 2012 that builders of residential communities in cities cannot charge separately for providing parking space.

To avoid paying for parking, you should opt for residential gated community properties in India as many multiplex apartments still charge a hefty amount for parking spaces.

Interior Decoration

No matter what kind of an apartment you buy, some amount has to be spent in readying it for everyday living. This amount depends entirely on your taste and sensibility and could run up to a few lakhs.

You may avoid this expense by opting for a fully furnished flat in a residential community. At every stage of construction, visit the site and instruct the developer exactly what you want in the apartment.

Maintenance Cost

Needless to say, living in an apartment complex has a few expenses entailed for its maintenance such as electricity bills incurred for common lights, salaries of caretakers etc. A lot of builders charge flat owners this amount as a lumpsum right at the time of construction. Usually developers quote that they are taking the money for maintaining the building for the coming 10 years or so. Avoid such schemes of builders because legally builders are not allowed to do this.

Registration Cost, Stamp Duty and Fees for Legal Counsel

After a property has been handed over, it needs to be registered in the name of the owner. The registration fees is usually 1-2 percent while the stamp duty comes to 5-6 percent of the total property’s worth. Other fees include those of the legal counsel, notary etc.

The fees that is payable for registration and stamp duty cannot be avoided but you can save a bit on the amount payable to the notary and legal counsel. You should research adequately into the amount that is payable for various heads, so that you can negotiate correctly with your lawyer.

Costs due to delays

Whenever you buy property, you can always be sure of delay in delivery by 6 months to 1 year. This may not be the developers fault entirely as some clearances do take time to come through. In that case, if you have taken a home loan to buy the property, you would have to continue paying the EMI. Moreover, tax rebates on home loans would not be possible unless you have possessed the property. If you have been living on rent, then you have to factor in rental costs too.

For avoiding these costs, opt for a builder which is known for timely delivery of projects so that you do not get stuck with delivery issues of properties in India.