Checklist for buyers before booking a flat The real estate sector was in a slowdown for the past 4-5 years, but its problems got aggravated in 2019 following the liquidity crisis triggered by the collapse of IL&FS. Two months ago, the government announced a Rs.25,000 crore bailout package to revive the stalled real estate projects. Checklist Under-construction flats are more complicated and riskier; here’s a checklist for buyers. One should get it right before booking in a new project.

1. Is project RERA registered? ( https://maharera.mahaonline.gov.in/)

Go only for RERA registered projects because it approves a project only if it has all approvals (Municipal corporation, electricity and water department etc) in place. However, these approvals are only for starting construction.

2. Are all details available?

All relevant information will be available on the RERA website. Since housing is a state subject, implementation quality of RERA varies across states.

3. Is the builder financially strong?

Don’t be under the impression that the house will be delivered smoothly just because it is a RERA registered project. As mentioned earlier, RERA approval is only to start a project.  The builder must be financially sound too. In addition to checking financial situation of the builder, buyers should also check about their other ongoing projects.

4. Have you seen the locality?

Facilities available inside the projects are mentioned by builders. Make sure that the physical infrastructure matches your need.

5. Is the timeline reasonable?

RERA imposes a stiff penalty for violating the deadline. To be on the safer side, many builders give a very long completion deadline and tell buyers that the project will be completed ahead of the deadline. Go only by the deadlines given on the RERA website.

6. Have you seen any progress?

Buyers also need to check the progress on the project before buying. Check the construction speed of the project for 2-3 months before committing.

7. Is the price reasonable?

Make sure that the price you pay in the area is reasonable. The most used ones are the rental yield and EMI to rent ratio. The rental yield is down now, but the price can be treated as reasonable if rental yield is around 2-3%.EMI to rent should not be more than 4 times.

8. Have you asked for discount?

The above-mentioned ratios are to check whether the rates are reasonable for ready possession flats in an area. Experts advise you to expect around 10% from leading developers and around 20% from mid-level developers. This discount range is for projects that are nearing completion. You can get a higher discount if the project has a lower completion rate.

9. Is your adviser independent?

In addition to checking documents with a good lawyer, it also makes sense to check the structure of the project with the help of a structural engineer.

10. Do you see the future?

Irrespective of whether you are going to buy the property for self-use or for investment, you should look out for future developments coming up in your area because that will increase your property’s prospects.   Source: TOI, Personal Finance dated 9^th December 2019