13 Things to Keep in Mind while Buying Your First House

Posted on 10th May 2017 Author: Planet Homes

Scouting for a dream home?

Don’t know what parameters should you keep in mind while searching for your residential property?

Here is a comprehensive list of factors that can enable people to evaluate a property thoroughly.

Right from the location to construction, from builder’s reputation to industry trends, from legal government policy to bank’s offers; there are a number of factors that are crucial for making a decision about purchasing your property.

These parameters would enable you to make your own check list before purchasing your own house irrespective of 1 BHK, 2 BHK, 3 BHK, villa etc.

So now let us move to check list.

1. Your Budget:

Plan your budget and devise a future income plan to compare your investment and your income. From EMI calculation, family’s future expenses to resale value, everything should feature in your budget. Buying a property for the first time needs a comprehensive long term plan for managing your spending. And once you are convinced about the budget range with all due diligence, stick to it.

2. Property Location:

Location and connectivity are another two major parameters for any property’s acceptability & price tag. The locality must have basic facilities like schools, hospitals and markets around. Also, the road connectivity should be up to the mark with nearby public transport facilities and late night transportation should be available. The less price of the property should not end up being a big burden of fuel and transport cost.

3. Prices Comparison:

Prices in real-estate market do not fluctuate with a huge difference but depending on the demand and government policies, they do. Developers and Builders treat this fluctuation as ‘correction’. Generally prices are not reduced but freebies and gifts are doled out to adjust the correction. But given the lack of demand, you can bargain for a discount on the property price instead of freebies because their prices are generally attached to the meanprice of the property.

4. Property Size:

A property can be amazingly affordable compared to the other projects in the same area however one must consider the price per square foot for comparison too. It has been reported in the Jones Lang La-Salle report that in past 5 years, average unit size of property has reduced by 31%. It is smarter to evaluate the layout of the project with carpet area and super area and compare the prices.

5. Clearances and duties:

In the past, there have been instances when the entire projects get cancelled due to non-compliance with the government or regulatory body orders. Necessary approvals and clearances required for the project as per the local laws must be met and the assurance of the same should be sought from the builder or developer. At the same time, while discussing the prices, who would bear the taxes, duties and fees should be made clear.

6. Resale/ Rental prospects:

The people living around the property, connectivity and municipality affiliation largely define the resale value trend or rental trend of the entire locality. Also, the low lying areas which are at the greater risk of flooding tend to shoe lesser resale/ rental prospects. A thoroughly planned investment might earn you amazing resale value and ROI.

7. Builder’s reputation:

Generally builders are active in small pockets of area and their recognition is limited to those localities. But one can always visit their previous projects and interact with the occupants about the quality and trustworthiness. Needless to say, a good builder would retain good rapport with the people and communicate well to clear their doubts. But if you think you are rushing in a local fearless goon, stay away.

8. Take your Time:

Never rush in to freeze a property and do down payment. Buying property can be a matter of great importance and hurry. But one should never enter in a deal blindly, without any background checks. Even if the property seems to be a dream come true. Contrary to the claims of the builders and developers of rising prices, you can rest assured, take your time and follow the gut feeling.

9. Sample House vs. Reality:

Sample houses are created specifically to impress the buyers and the interior and lighting arrangements are used as illusion to give an impression of a specious area. Also, as the sample house generally is secluded, it gives amazing air circulation and lighting experience. The situation in the actual property might defer drastically. So, evaluating the actual property is essential.

10. Amenities and Supplies:

Always be sure about the water connection, drainage& sewerage connection, electricity shutdowns, and garbage collection routines with the builder and the residents of the locality as well. These are the most essential features of any property. Apart from that, the amenities like gym, club house, swimming pool, gardens and security arrangements positively adds on and they also improve resale prospects.

11. Construction Quality:

Evaluating the quality of construction, however vital, is difficult for the common man. The brands of materials like TMT bars, Cement, and other fittings can give an overall idea about the quality. If the developer can provide a certification on the quality, it can be a good assurance. But generally, you can visit the site while the construction is in progress and evaluate the processes on spot.

12. Payment and Possession:

The timeline of payment and possession should be clearly defined in the agreement. And payments are recommended to be done through cheque or bank transfer, to keep a legal record of the transaction. The possession timeline may get delayed due to any reason and hence there must be clarity on the compensation/ penalty clauses in the agreement, in case the possession is delayed.

13. Bank loan & Property insurance:

Most of the time builders advertise tie-ups with banks for easier loan processes; this however does not guarantee the best interest rates. For the lowest interest rates, you might have to visit from branch to branch of the banks and negotiate for the best figures. Also, one needs to understand government policies regarding the loan rates and plan it well. On the other hand Property insurance is a good step to ensure the future of your property. But there are a plethora of policies and they all come with a set of terms and conditions which need to be scrutinized thoroughly before opting for it.

In any case, a buyer must go for a professional legal consultation, to be sure about paperwork and terminology scripted in the agreement. Legal provisions of tax and urban development rules can’t be taken lightly and the property should be legally viable. A little legal cost can help save millions here.

One thing is sure, whether you are an amateur first time buyer or experienced second time buyer or you are a seasoned investor, the builder needs you and you are the king if you act right.

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