Smart Search: Check where you should buy

The common dilemma that the consumer at our Open House forum poses is what is the right time to buy? The 'right' time to buy your house is when you feel that you are ready for the responsibility that comes along with buying a house. It is important to consider the objectives of buying a house. Ask yourself why you want that house? What really is the motivating factor when it comes to your decision to buy that house? Do you want to buy it because you want to live in it with your family or do you look for an extra income that the house will bring in the form of rent? Or, are you simply buying it for long-term value leverage? The more you know about why you should buy a home, the more focused your search will be and the better you will be able to select one that meets your requirements.

One should buy property in an area which has adequate basic amenities such as power, water, sewerage, etc. It is important to do your checks and balances while deciding on a project. Infrastructure in the area, connectivity, builder's goodwill and price of the property are key components a buyer needs to take into consideration. A buyer should also carefully check points such as the builder's experience, number of projects completed and delivered, banking institutions involved and present buy options available to suit your requirements. It is better you conduct a field survey before identifying a suitable property meeting your budget and location preference.

When it comes to choosing a location, the consumer looks at connectivity and availability of basic urban and social infrastructure in that area. Big cities have that advantage. Land values are very high in many big cities. When investing in a big city, keep a few things in mind. If you are purchasing for self use, buy in a neighbourhood that has all the conveniences that you require and also has good accessibility to the rest of the city. Even in premium localities, if you keep searching, you will find properties that suit your budget. If you cannot afford the premium rates, look for a locality on the fringes of your area of choice. This will have all the advantages of proximity to the main locality but sport lower price tags. Also, look for property that is being re-developed in city areas. They will be new and come with a maintenancefree period.

It depends on the property you are buying and who offers it to you. In case the seller is a realtor, it is best to buy through him after doing a background check on his reputation because he would know what legal checks must be made by you before putting the money on the table. In case a seller is an individual he must hire the services of a good lawyer to do a due diligence on title, etc before you write that cheque. This money spent on due diligence may pinch today and seem unnecessary but in the long run you will realize that this is a wise decision.

If you are buying a new property, you have to pay Service Tax, VAT and Stamp Duty on the total amount of purchase. If you buy re-sale property, then you do not have to pay any of these taxes.

Documents required while buying property are Identity Proof like Voters' ID Card, Passport, Driving License, Ration Card and Pan Card. Be careful of the Sale Deed/Agreement and also check that the complete property chain is mentioned in the Deed.

The main criteria are:

• Your income and your track record of repaying previous loans - this is obtained from the Credit Bureau.
• Your current expenses including other loans you are servicing. The amount of loan related to the property value.
• Ownership of the property - this means that the lending bank should be comfortable that the seller has full and complete ownership of the property.
• Getting a loan depends on the report of the local bank surveyor who will inspect the property and give his recommendation.

The real estate market is similar to the stock market, with its peaks and troughs always seeming to make perfect sense in retrospect. Also, both markets reflect the economy of the country and offer good investment opportunities. However, the risks must be understood along with the opportunities. Realty index will appreciate five times, but not the stock market.

Do your complete research on the Web and physical survey of the projects. Invest in projects which are at least 25-30 per cent complete as this will be comfortable in terms of approvals. Brokers may sometime offer better rates than the developer's sales team. Bank approved projects are preferred since they give comfort in terms of the approvals.

Your decision to sell your property depends on the following factors:

Property market in your city/locality : The residential property market is locationspecific and the prices will vary for different areas.

How soon do you need the money? Do not sell your property in a hurry if you do not need the money urgently. Getting the best deal may require patience or even spend some money to add value to your house. You also need to consider the rental return from the property as it will be a source of steady income.