MUMBAI: the city where the dream of owning a cherished home can turn into a dreadful experience for the flat buyer. Mumbaikars have spent sleepless nights after authorities have ordered the demolition of their buildings for violations the residents were unaware of. The beleaguered residents of Worli’s Campa Cola compound, and those who later found that their buildings stood on forest land, are only two such examples.
TOI has therefore put together a comprehensive guide to help residents of the city when they are looking to buy a home, especially so one can ensure that the developer has not flouted rules and has all approvals in place.
Housing experts warn that prospective buyers should take the time to read the fine print in agreements before investing in property. There are several problem areas the purchaser needs to be aware of.
First, check whether the builder has in fact procured permission to conduct development on the land. In case the land has not been set aside for residential purposes, then the builder should have permission to convert agricultural or industrial land to residential. If the builder has gone ahead without securing this approval, the entire project is illegal.
In Mumbai, a builder must receive no less than around 50 clearances before he can start a project. This includes having a clear land title and environmental and air traffic approvals. A flat buyer should check if the local planning body has given the builder all necessary approvals, including the all-important Commencement Certificate.
The builder has to ensure his project does not flout urban and town planning norms, and that it has unrestricted access to the road network.
Bank on banks
“One way for a flat buyer to avoid getting trapped in an illegal project is to invest in a project backed by banks,” said an official at a reputed financial institution. “Banks do not give loans to projects where due diligence and background checks show that approvals are pending. We also do a check of the land title for up to 30 years before sanctioning any loan sought by developers. We can, therefore, allay the fears of buyers to an extent with regard to irregularities in a project.”
Own it all
Find out if the builder has the authority to transfer the undivided share of the land to each flat owner and the entire plot to the society on completing the project. A Knight Frank research report, ‘Parameters for Buying a Home’, said buyers should ensure the builder does not reserve any right on any portion of their apartment or building, like balconies or terraces.
Never forget to read the sale agreement. Developers are known to charge a huge price for additional features, such as a swimming pool or designer furniture. Check if all the promised amenities are incorporated in the agreement and that there is a penalty clause in case of non-fulfillment. Developers escape paying a penalty by inserting a clause that states they reserve the right to alter any promised feature.
Paper has more weight
Any sample flat shown to the buyer will be demolished long before s/he obtains possession of the house, leaving him/her with little evidence of the promises made in case the developer has to be dragged to court. To be safe, make sure the promises are on paper and scrutinize the approved construction plans to ensure they match what has been promised. Approved construction plans must be mandatorily displayed at the construction site at all times. Important approvals should be available at the builder’s office. Ask the builder for the requisite permits from the concerned authorities.
Under the Transfer of Property Act and Maharashtra Ownership of Flats Act, a seller (builder) is required to disclose all facts relating to the property, including the various permissions acquired by him. If a builder refuses to do so, a prospective buyer has recourse to fight back through the same Acts.
“But if any of these documents are missing or the builder refuses to show them to you, it is best to simply stay away from the project,’ advised Ramesh Prabhu of the Maharashtra Societies Welfare Association.