8/12/2019 17 INVESTING in REAL ESTATE is Your Checklist Complete

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INVESTING IN INDIAN REAL ESTATE Is your checklist complete? Think again

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In the last two years probably the four words that have made the most frequent headlines in news

articles and magazines has been the Indian Real Estate Boom. arious authors have published

tables showing !" to #"" percent gains in a year through real estate investments. Reading aboutthis dream money ma$ing industry time and time again has made most to believe that there

indeed e%ists the &idas 'ouch. (eople from all wal$s of life have either invested ) in the process

of investing or planning to invest there hard earned life*s savings so as to multiply it by at least a

factor of two in the recent future. 'his has got the +evelopers laughing all the way to the ban$s.Even though the last three months have seen a price correction of upto !", in resale of properties

there seems to be hardly any coverage in the press. Each day you find the dream still selling-

people who have made investments li$e such headlines as it gives them a false sense of

satisfaction.

&ost upmar$et apartments give there occupancy levels to be in the range of /"0" percent.1owever if you happen to ta$e a late evening wal$ 2when you e%pect at least one member of the

family to be present3- 4"5" percent apartments would have there all lights turned off leaving a

question mar$ on what is being claimed. 'his collaborates the point made earlier that most suchapartments and houses belong to those who have made investments and are waiting for the &idas

'ouch.

'he so called realestate boom has attracted so many new players in the mar$et that it is a nearimpossible tas$ for the common man to identify those who follow the laid down rules and laws

from those who believe in hoodwin$ing the authorities. 'he glossy newspaper advertisements thatgreet our eyes each morning surely succeeds in ma$ing us believe that buying the advertisedapartment would ta$e us into paradise. 1ow many times do we see developers addressing issues

li$e earthqua$e safeguards and total land area of colony in their advertisements6 'he agreement

between the buyer and developer would certainly contain the clause that if the electricity bills arenot paid in time the electric supply to the apartment would be stopped but how many times do we

read that that incase it is found that the building is not meeting the minimum Earthqua$e 7afety

requirements spelt out by the 8overnment the builder would be held responsible- alternately how

many times do we see the area calculations giving out the total area of the colony. 'he municipalauthorities generally sanction a 9loor :rea Ratio of appro%imately #.4 for group housing colonies-

this implies that incase the plot area is #""-""" square feet then the developer is authorized to

construct #4"-""" square feet. :lternately we can say that if an apartment building has #4"-"""square feet as it*s built up area then the land area of the colony should be #""-""" square feet.

1owever if not most- many developers do not hand over the entitled land to the society and $eep

chun$s in their possession so as to be used at a later date.

Earthqua$e awareness amongst all- most builders are yet not following even the minimum

guidelines for earthqua$e safety. Earthqua$e Resistant is the minimum safety standards that a

building should be designed for; 8overnment has laid down these minimum guidelines after great

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8/12/2019 17 INVESTING in REAL ESTATE is Your Checklist Complete

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deliberations so that as a minimum- o +eveloper in India is offering 1igher than

Earthqua$e Resistant construction. Even the highprofile pro?ects which want the consumer to

shell out e%orbitant sums are claimed to have followed the &inimum Earthqua$e 7afety7tandards i.e. Earthqua$e Resistant- however even this minimum safety is not endorsed in the

buyers agreement. : small additional cost of Rs. @4"!"" per square foot used to install energy

dissipation devices) dampers can achieve a 1igher than Earthqua$e Resistant safety standard.

&ost manufacturers of energy dissipation devices) dampers guarantee their products for upto !4years which is further renewed after testing.

Ahat the Indian Real Estate investor needs to be doing is deliberately evaluating if he is ma$ing

the right investments- not by getting carried away by glossy advertisements but getting relevantprovisions endorsed in the buyers agreement.