Basic Terms and Terminologies in Real Estate (Must Read Before Buying Any Property or Flat)

I see majority of the population in our country is Illiterate when it comes to basic knowledge about Real Estate. Mark my words it is not rocket science. There are few terms which everyone should know in order to at least be able to understand what someone who is into real estate is talking . They are a bit too technical but I think everyone has a dream which is to own his/her own dream house and you would not want to be cheated at least in this matter.

When you talk of Real Estate this are the terms which are used frequently


Carpet Area, Built up Area, Super Built Up Area, FSI, Fungible FSI, TDR, Loading factor, Per Square feet area, Beams & Columns, Slabs, Podium, RMC, Clear Title, NA, City Survey Plan, Registration Office, Property Card, Litigation, SRA

Conveyance Deed, IOD, CC, OC, BCC, Maintenance, Compliance, Bank Guarantee, 

I know the list is extensive but I don't want you to be Bullied by any Real Estate developer from now.
Following are the Terms which you will listen and see developers using frequently.
  
Carpet Area, Built up Area, and Super Built Up Are - Carpet Area is basically the area which is enclosed within the walls, the area where you lay the carpet. This area does not include the thickness of the inner walls. It is the actual used area of an apartment/office unit/showroom etc. Flats are sold at Carpet Area

Built up area is the carpet area plus the thickness of outer walls and the balcony.
 
Super Built Up Area is built up area plus proportionate area of common areas such as the lobby, lifts shaft, stairs, etc. In short the entire buildings area

FSI (Floor Space Index) & Fungible FSI - Formula for FSI is (Total covered area on all floors of all buildings on a certain plot)   /   (Area of the plot)

Fungible - Used by Developers having less permissible FSI. Developers can buy additional FSI , The maximum he can construct over and above the permissible FSI is 35 per cent of the flat area

TDR - Transferable Development Rights TDR effectively allows developers to exceed the FSI or the FAR of the land, allowing them to build additional floors in a building

Loading Factor - (Sale able Area - Carpet Area)/Sale Able Area basically it is is the difference between the carpet area and the Saleable Area. Make sure that the loading factor should not exceed 30%. Lower the better for you

Flats are sold per square feet the avg size of Apartments in Mumbai are

• 1 BHK- 400 to 750 square feet
• 2BHK-800 to 1350 square feet
• 3 BHK-900 to 3100 square feet
• 4 BHK-1300 to 4250 & more square feet 

Beams & Columns, Slabs, Podium, RMC are all a part of Construction Plan, RMC by the way is Ready Mix Concrete it is used by Developers to increase the pace of the construction activity.

Clear Titlt, NA, City Survey Plan, 7/12 and Property Card -  This are the core docs which a developer looks for before going forward for any land deal.
A title search for a period of last 30 years is done to know the actual property owner and to see whether the property transfers are done legally or not where as NA is non agricultural which as land can be used for development. City Survey plan  - Property Card are bought from the Talatis office to find the exact measurement and all other necessary info about the land

Litigation is when construction process is stopped due some legal procedures not met or due to court order.

Maintenance and property tax - There is a lump sum and recurring maintenance which is charged by developers till such time the building has been fully handed over to society of owners. make sure that you know what you are paying, probe the developer and get all the details of the amount paid towards what. Also understand the total recurring costs that each flat owner will need to bear towards property taxes and maintenance every year.

SRA - Slum Rehabilitation Authority is whole and sole regulatory authority who gives permission to developers constructing a building under SRA scheme.

Consumer Point of View

Documentation -  Folks please make sure that your legal team ask for all the below before you book a flat

Initially look out for whether it is a NA - Non Agricultural land or not and then ask if all approvals are taken before Constructing that particular Building. 
Other basic docs include IOD, CC, OC, BCC
IOD - Intimation  of Disapproval, CC - Commencement certificate, OC - Occupation Certificate, BCC - Building Completion Certificate
After looking at all the above things make sure that the there is a Compliance which is the flats are made as per the approved plan.

Home loans are available for almost projects as the projects are given a Bank Guarantee by nationalized banks. It is on you to decide your home load proceedings

Hope you all are confident enough now. Don't be in a hurry in signing the dotted lines in the agreement given to you. Read all the clauses properly , Take help from consultants if you are not sure or if you do not understand any of the clauses in the agreement . The charges are nominal but this would save you from what can become the biggest mistake of your life.

I don't say all developer cheat but there are few developers who use this illiteracy of prospective home buyers and try and manipulate things in the agreement. Be aware of such developers and be Vigilant and proactive about your property deals. I may have forgotten few terms but will surely keep you all updated with them shortly.

Feel free in posting your doubts.




 

 

Scenario Planning - Real estate 2020

What exactly is Scenario Planning?

We all know that future is uncertain and we cannot do anything about the same. So in this helpless situation Scenario Planning comes to the fore where can get a sagacity of this vague future. It was Mr. Herman Kahn who was the founder of this technique but it was then utilized by businessmen in 1960's

Uncertain Future

One must drill this into its mind that scenario planning is not predicting future , we are not saints and we do not want to be in that monkey business. We are business men we attempt to describe what can be the possible future

According to me there are only 2 Industries who are like the evergreen forests, who shall , will and always grow irrespective of the other factors in our country. 1 of them is Film Industry and the other is Construction Industry aka Real Estate.

Let us only concentrate about Real Estate Industries scenario in 2020.

Here we are in 2020 I see all the things digitized where on 1 hand you can get property cards, 7/12 and other land information related docs online and on the other hand your registrations and other legal procedures are online. Everything has become transparent so there is no chance of any forge documents and officers taking bribe for doing work for which they are paid for.

Nowadays everyone is moving towards eco friendly constructions where there is a mandate by regulatory body (CREDAI) wherein builders not adhering to eco friendly constructions norms are not issued CC. LEED India certification is now a mandate for all Real Estate Developers.

We have not the biggest 252 storey building built by Lodha, who are now the largest players in this sector. The other players are also doing well and bringing in some new concepts to their projects.

Nahar Group have broken the record of completing a 120 storey building in 5 days . this was possible by the use of ready made slabs, beams and other highly mechanized Equipments.

Finaly Godrej Properties have completed their 12 storey project on Moon and the rates are estimated to be around 1.5 lakhs per square inch.

 BMC is now very strict about all the permission and licenses and the penalty amount is huge which has made developers think thrice before doing any illegal thing

Virtual tours are very famous this days where you can see and stay in the house online on 10 D and you can even stay there for a day.

 Home loans rates are now as low as 5% and there are few banks which are owned by this developers where the rates are as low as 2% for a home loan.

Builders now charge for per square inch and rates are soaring accross the country. The variability is so high that we have a house from 1 crore to 50 crores in a distance of 20 Km.

In the end the picture to me looks rosy as i see this sector is now focusing on development of the nation , a sector which is organised like any other sector with no corruption. Investors & potential home buyers are also happy when that know everything about their property and all the possible reasons why they have been charged XYZ amount.

 


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