As you embark on buying a home, one of the first decisions is whether to buy a new home or a “used” one. Each choice has its advantages, and there is no single answer that works for everyone. Here are some things to consider if you’re looking at a resale.
Documentation And Procedures- There are certain challenges that a buyer of a resale flat may face. This could include lack of proper chain of documentation, especially in cases where the property has changed hands more than a couple of times in the past. If the property is over 18-20 years old, it is possible that it was never formally registered in the first place. Registering it at the current point in time would put the onus of paying the stamp duty in arrears on the buyer. Obtaining a home loan for a property which is anywhere close to 50 years of age can also be a challenge.
All the documents that are applicable for a primary residential property sale would be required for a clear resale flat transaction, as well. The seller should be able to produce all original documents. The original sales deed and the Society share certificate are most important, since the transaction cannot proceed without them. Also, the buyer should bear in mind that in the case of a resale property, proper transfer and re-registration is necessary.
Price factor - In the larger cities, new residential property supply is scarce or non-existent in many central locations. In such areas, there would not be a question of discounts on resale properties. Discounts are more prevalent in areas where the market is more competitive. That said, resale properties are sold either by the primary owners or by investors. As such, there is a higher possibility of flexibility in payment terms.
Location - Older homes are often found in convenient metro core areas rather than outlying suburbs. Some buyers prefer to select for optimal location first, then remodel the home to make it bigger or more modern.
What you see is what you get: The difference between the super area and carpet area has always been a contentious issue. But, of late, the problem has assumed alarming proportions. The super area includes common facilities, such as corridors and staircases, enjoyed by all the units in the building. The carpet area is the actual living area inside the house. The gap between the two has increased in recent times. In some projects in the National Capital Region ( NCR), for instance, the carpet area can be 30% smaller than the super area being touted by the builder. In a resale property, there is no builder or marketing gimmicks. You get to see the property on the basis of the actual carpet area. So, even though the per square foot cost of a resale property may appear high, it will also offer more usable area.
Maintenance and repair- A lived-in home has some wear and tear. There may also be additional expenses for repairs to masonry, plumbing, electrical wiring and fittings. Make sure you have a good handle on the working status of all major systems, and hire a professional home inspector to check the house. If electrical or plumbing systems or appliances require repair or replacement, that may be reflected in the purchase price. Usually, older properties have lower maintenance charges compared to the new ones. This could be due to the slew of additional facilities in new projects
Extra features- Lived-in homes typically already have features that would cost you extra in a new house, such as window blinds, a security system, a landscaped backyard, built-ins, cabinets, and so on. Finally, one should bear in mind that the Indian residential property market is in a constant state of evolution. One is unlikely to find the facilities and amenities that are available in the newer projects on the market in an older building. But on the other hand, with an older home, you know how much the property has appreciated over the years. Of course, past performance does not guarantee future market appeal, but at least you have some measurement to date.
Also, one should keep in mind while purchasing a second hand home that older properties require general structural maintenance more often than the new projects. Recurring costs like painting the building, water-proofing and structural repairs have to be borne by the residents, which adds to the financial burden of the individual. A new property will not have to incur such repairs in the first 10-15 years.
This article is authored by Mr. Raja Mukherjee Head - Sales & Marketing, Concorde Group
No comments:
Post a Comment