News: Planning to buy a resale property? Here is why you shouldn’t-01-09-2020
https://timesofindia.indiatimes.com/spotlight/planning-to-buy-a-resale-property-here-is-why-you-shouldnt/articleshow/77853649.cms
The famous saying by Franklin D. Roosevelt “Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world.” is currently supremely relevant in these unprecedented times. Homeownership is a common desire and it is a ‘once in a lifetime’ decision due to the premium attached to it and makes many cut edges like looking for resale to save on cost. Somewhere, the decision of buying into resale after all the efforts put in researching basis preferences can backfire. Living in these testing times, it is imperative that one would like to build their safe haven by eliminating all risks and welcome stability and security for the family. And with lowest interest rates in over 15 years and the recent announcement of a reduction in stamp duty till the end of this year, it’s the best time to buy into a brand new property which is absolutely risk-free rather than opting for resale properties. Homeownership is a decision that brings stability and security for one’s family which is priceless and to make it even more special it is important to go in for a hassle-free home buying journey. Looking for a perfect property can be a daunting task, more specifically if the property under consideration is a resale one. Buying in resale property might take 3-4 months to take care of all legal and technical issues. Most importantly many times not knowing the person you are buying from can have a huge fall-back of not being aware of all the liabilities it brings along with the resale purchase.
To save yourself from any hurdles, you need to make smarter decisions. People often spend their life savings on buying a house so the last thing you’d want to have is a nightmare of an experience for the home you’ve always dreamt of. Resale properties have their own set of complications as they need title check and verification of documents, closure of home loan by the seller and the process takes a lot of time. When we start the hunt for the perfect house, we always think of making it a hassle-free experience and for that, the best thing to do would be to buy a new property directly from the developer rather than going for a resale one because of the following factors:
Due Diligence Involved
Choosing the right property is just the first step and there are many formalities and paperwork that follow like title clearance, allotment letter, sale agreement, NOC, environment clearance, sale deed, society incorporation certificate, among others. There is more risk involved in the resale property as it could be in conflict (termed as bad debt). You’ll require a lawyer for checking all the legal and technical documents, this includes title deed, land use, approval from municipal authorities, Occupational certificate etc. Generally, it is advised to hire a lawyer when you are buying a resale residence who charges anywhere between ₹ 50,000 to ₹ 2, 00,000. There is a risk of losing the initial token amount and the amount spent on due diligence in case the deal does not go through.
NOC & Clearances
You will have to look into mortgage payment history and avail a NOC from the bank to avoid undue troubles post-purchase. The old home loan on the resale unit should be either foreclosed or transferred to the buyer for executing a sales deed. In case of an existing bank loan, the title documents are with the bank and they get released only when the loan is foreclosed. This generally takes 2 to 3 months of time again delaying the entire process for you. Post this, to ensure that there are no outstanding dues for the unit, a NOC is required from the developer as well. There is a high chance that this will delay your purchase due to outstanding dues to the builder like maintenance, other charges, etc. One also needs to pay a transfer charge (around ₹25,000) for receiving the NOC. It is therefore prudent to go with reputed developers who can take care of all the documentation process so you can focus on building a better life without having to worry about any delays.
Flexible payment plans
Buying a property from the developer guarantees cost-effectiveness to a reasonable extent. They give flexible payment options tailored according to your current financial needs. When there is a resale property, the expectancy of making the full payment to the owner of the property is very high but in the case of a developer, the payment options may vary from one individual to another depending on their pocket, making it less stressful for the buyer. Also, in case of a resale transaction, a buyer must pay at least 1% brokerage to his broker for buying a property in resale. If one buys from the developer directly, there are no brokerage fees involved, also the developers make the process smooth by bringing transparency to the transactions. When you buy a brand new property from the developer, they mostly take the responsibility for getting you a spic and span new home eliminating the need for maintenance and all the repairs in the initial years. So cost-effective, isn’t it?
Support in getting the loan from the developer
Getting a loan becomes a very easy step for those who go for a new property through developers as they provide its customers with support in getting a loan. People going for resale don't get enough loan options considering it’s a resale property. The developers have tie-ups with top banks and institutions to get you home loans at attractive rates and on time. This can be incredibly handy since easy loans from reputed banks once again assure us that the property has clear titles and required documents. As there are multiple units/property of a branded developer, the bank is already aware of the project so there is no research required from bank’s end whereas, in the resale property, the owner is required to go the bank himself to get approvals even if the project is pre-approved by the bank, making it a lengthy process.
New Home with more inventory options
Buying a new house is a dream for everyone and who understands it better than the developers with a consumer-centric approach. With developers, you can get more choices of inventory, taking into account the view you want, your floor preferences, Vastu, your parking needs, tower location, etc. These properties are much better and convenient as compared to those of landowners where you don’t get much of a choice. More importantly, a resale home is all about somebody else’s dream and innovation but a new home is a new dream for you and your family that gives you self satisfaction that is aligned with your imagination and preferences. Additionally, this will give you a hassle-free experience post-purchase so that you live with your family the way you have always imagined.
