As much as buying a property in India can be a dream for many NRI's, it can also be a daunting experience due to certain aspects of the process. Meticulous planning from the initial stages can help to avoid any hassles at a later stage and it is important to be aware of possible hurdles, and do your research thoroughly. Make sure you check the credentials of any agents that you may be considering to use for the deal; that you understand the complicated tenancy laws and title defects with regards to the project you are interested in; and that you have factored the financing and condition of the property as part of your research.
To help you along the way, here are some more in-depth considerations and pointers that you should bear in mind before embarking on your investment:
Location, Location, Location
An often repeated mantra with any property purchase world-wide, this is taking on new meaning in India with the construction of new infrastructure such as highways, bridges and metros.It would be advisable to investigate the surrounding area to be comfortable with its locality and accessibility for your requirements, especially in the newly emerging markets.Unesta.com can direct you to the area of India that meets your requirements, whether it is near your ancestor’s birthplace, a booming metro city or popular tourist destination.
Cities in India are categorised into either ‘reside-in’ or ‘earn-in’ when it comes to property investment. The key parameters for ‘reside-in’ cities are health, education, environment, safety, public facilities and entertainment. For ‘earn-in’ cities the criteria is based on growth rate of employment, per capita income and opportunities available.
As with all property purchases, there are several expenses beside the purchase price that need to be accounted for:
Future house tax/property tax payments
Buying from a developer
There are several factors to consider when buying property that is still under construction. Reliability of the developer is paramount, and you should enquire as to the reputation and record before committing to buying any property that is still in development. Although unesta takes every care to validate credentials of the developers listed on our site, it is vital that you undertake your own research before making any decisions. Financial institutions and banks funding the developer can help with enquiries and to gain a better understanding of the developer’s financial status. It is important to look into aspects such as timely possession, quality of construction, compliance with the sale agreement (especially penalty clauses), providing the amenities mentioned, etc. It is also important to gain first-hand knowledge and the perspective of a previous buyer who has dealt with the developer where possible.
Once you are convinced that the developer is reputable, a lawyer should be instructed to commence a search of necessary documentation,such as:
An approved plan of the building along with the number of floors, and that the floor on which the apartment intended to be purchased is approved or not, as sometimes developers exceed the permissions granted to them.
Whether the developer owns the land on which the building is located, or whether he has undertaken an agreement with a landlord. If so, the title of the land ownership, development agreement with the landowner, and power of attorney executed by the landowner in favour of the developer must be checked.
That the land is not designated as agricultural land, else the construction will be illegal.
The building byelaws as applicable in that area and whether the builder is not in violation of front setback, side setbacks, height, etc.
Whether the specifications given in the “agreement to sell” or the sale brochure correspond with the plans of the construction.
Whether urban land ceiling NOC (Non Objection Certificate), if applicable, has been obtained, and whether NOC from water, electricity and lift authorities have been obtained.
Identifying an agent
An agent can assist in locating and evaluating the right property, providing useful market information and resources, and eventually guiding you through the whole process until the purchase is complete.
However real estate broking firms (estate agents) in India are often not institutionalised, and therefore it is essential that the buyer proceeds cautiously and chooses an agent who is experienced and knowledgeable about the market, transparent and informative through the entire process, and objective while providing detailed and necessary information.
Another option is to cut out the middle man altogether – and with the help of unesta.com, you can do just that. All the developers listed on our site have an international sales and support team, making the need of an agent redundant and helping to guarantee the best possible price for your investment as there is no commission involved. Not only does this save you money, but it reduces the stress levels of dealing with someone who may not be altogether reliable.