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Buying resale flat leasehold plot standalone building

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Buying resale flat leasehold plot standalone building

Last updated: October 11 2019
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  • Buying resale flat leasehold plot standalone building

    PUNE: Hi everyone, we are interested in buying a flat in a 4-storey standalone building (no CHS, no apartment) constructed in place of a bungalow.

    Original plot owners are on a 99yr lease under a co-op.
    They own 3 flats and 5 flats were sold to outside buyers. One of these outside buyers wants to sell this flat now.

    His title documents are clear.

    My parents would own this house. But i read somewhere that if something bad happens, the original owners/heirs get full rights over the land and other flat owners/ heirs have no rights.
    Is this true?

    Are there any other future risks of buying on leased property?

    Can the original owners create any issues, because the plot of land is theirs?

    Thanks so much in advance!







    Last edited October 4 2019, 04:23 PM.
  • #2

    #2

    Re : Buying resale flat leasehold plot standalone building

    What peope don't realize when buying a "flat" is the importance of land on which the flat exists. Ownership of land is as important as owning the flat.

    However majority of housing societies struggle to get land/title tansferred in their name.

    In your specific case, there is no C.H.S, no apartment deed etc. So the plot is owned by the "original owner" forever. Any benefit that gets accrued over the years on land will not be passed on to you.

    For example, when FSI on the plot increases, original owner may have the option of constructing another floor on top. So he makes money but you will not get anything.

    If there is ever redevelopment on this plot, land owner gets more benefit.

    There is nothing wrong per se in buying flats of this kind, but the price needs reflect what you are losing out in the long run due to lack of ownership of land.


    Comment


    • fraisivy
      fraisivy commented
      Editing a comment
      Thanks for replying Arun, I'm Harsha.. So the flat owner is saying that the remaining owners are looking to form an apartment but who knows if thats true and if the owners would agree to paying their 1/3 share. What is the best way forward in a situation like this to safeguard ourselves in the future? I'm asking coz we love the flat and would like to consider all options.
      Last edited October 4 2019, 04:09 PM.

    • realarun
      realarun commented
      Editing a comment
      See, the land is 99 year leasehold. After 99 years, land goes back to the original owner. After that period, what happens to your flat is a question. 99 years is like 2 generations. Do you really care about that far is something only you can answer.

      2. Managing the affairs of the building, water, security, house keeping etc can be done only by cooperation between these 9 flats. So you guys will have to be involved in running these affairs. Calculation of maintenance charges, raising bills, making sure everyone pays etc.

      Considering you like the flat, you need to be prepared for what you are getting into.
      Leasehold properties with 99 year lease, will command lower valuation in the market in case you ever want to sell it in future.

      Everything depends on the price you are getting it at. If you get a very good price then the value outweighs risks and vice versa.
      Good Luck.
  • #3

    #3

    Re : Buying resale flat leasehold plot standalone building

    Hi Arun..You've been very helpful, thanks a lot

    Comment


    • realarun
      realarun commented
      Editing a comment
      All the best and good luck.
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