Quote:
Originally Posted by yeskrish
Request members to help me with identifying the documents required frm the seller.
My understanding is tto start with to get the documents and get a legal opinion first.
Then get a EC from the CMDA or Municipality for the property.
Is there anything else? I am sorry as i am new to this.
My concern is how tomake sure that the document is authetnic and / or the owner is authentic.
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Value of resale flat depends on the land share.Quoting one of my old post that explains how to calculate price of a resale flat taking into account depreciation.
Quote:
Originally Posted by nabishek
Friends,
I am sharing here my understanding on depreciation of resale flats from the information i have gathered.
For a resale flat one has to consider value of land, estimated life of building, age of building and facilties available.
lets take for example a 20 years flat with 1500 sqft builtup 1000 sqft UDS.
If the flat was to be constructed today assuming the market price of land is 10,000/sqft
cost of land = (UDS * current market price) = 1,000 * 10,000 = 1,00,00,000
cost of construction = (built up area * construction cost) = (1500*1200) = 18,00,000
Total = 1,18,00,000 including all other charges.
The rate of depreciation is calculated as follows
The normal age of a building is considered to be 60 years.
Depreciation is calculated such that at the end of 60 years the value of the building becomes zero.
Out of the total asset value the residual or scrap or salvage value, is normally taken at 10% and can be ignored.The remaining 90% of the building cost is spread over the 60 years.
hence, rate of depreciation is 1.5% per year.
So if a building is 20 years old then rate of depreciation is 30%. i.e. the building is 70% of its initial value.
The cost of the resale flat would work out as follows if assuming the cost of construction 20 years back was 250/sqft.
cost of land = 1,00,00,000
cost of building = (1-(30/100)) * (1500*250) = 2,60,000
Total cost of resale flat = 1,02,60,000
Because the flat would have been puchased at lower input cost,at cheaper land rate and due to poor maintainence, the owner may also be willing to offer at 30-40% lesser than the calculation above.
If a person who holds a old flat (25-30 years+) wants to reap the benefits as per the true valuation above.The most profitable option is to go in for a joint venture along with all the residents of the building by hiring a builder or their own contractor.
With the relaxation of FSI,they can get substantial amount of money in hand and possibly also retain a flat in the complex by only sharing their space with few more additional neighbours.
Over the years land value appreciates and building value depreciates.
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Apart from checking the building and land documents, Ensure the following
1. Buy resale flat of reputed builders and preferrably sparingly used,well maintained,individually owned flats.Check other projects by the builders to know the quality of construction.
2. Ensure no deviation in plan and UDS registered in proportion.
3. EB connection on individual owners name.
4. Corporation water connection available.
5. All property/water tax paid and no dues.
6. Car parking registered in owners name, if applicable.
7. Owners Association formed and registered legally.
8. If flat allotted by any association or society, transfer share certificate if any or get NOC from respective society.
9. Flat not mortgaged or lien on the property.
10. If flat rented out, check if there is any rental/lease agreement.Ensure its vacated before its bought or arrive at an understanding with the lessee.