Sunil's cautionary tale: The Importance of Property Reports in Real Estate
The Importance of Property Reports in Real Estate
Sunil, like 1.3 million Mumbaikars in 2022, was mesmerised by the flashy advertisement of a builder showcasing a luxurious apartment project in Vasai, an emerging residential hub in Mumbai. After 15 years of hard work, he saw this as an opportunity to finally own a place he could call his own.
Swept up in his aspirations, Sunil became impatient during the due diligence process. Every additional day waiting for a document made him anxious about missing out on his hard-earned dream.
Although he glanced at preliminary documents like Satbara, he dismissed the idea of seeking legal assistance for obtaining a property report. He believed it was time consuming and unnecessary since many others were buying apartments in the same high-rise building.
We conducted a survey and found that 34% first time buyers skip obtaining a property report. Despite the fact that buying a property requires careful consideration of key factors like:
- Ownership and Authenticity of the Property
- Government Regulations and Restrictions (such as Coastal Regulation Zone norms, heritage regulations, Forest Rights Act, and slum rehabilitation schemes)
- Approvals of Building Plans
- Occupancy Certificate
- Reputation of the Developer
- Land Usage approvals
Sunil soon discovered that his new property was constructed on tribal land, subject to strict laws of the Forest Rights Act (FRA), 2006. He unwittingly became part of a large percentage of urban property buyers in India who end up purchasing properties with similar legal discrepancies. The aftermath of such mistakes can be devastating, with buyers facing potential legal consequences, financial losses, and emotional distress.
Understanding the gravity of the situation, Sunil turned to a real estate lawyer. A thorough review of the situation revealed that the best recourse was to rescind the purchase and request a refund from the builder - a process full of complications, given that only 19% of property refunds are granted without disputes, as per the 2022 Indian Consumer Court Report. Sunil's experience highlights the pivotal role legal counsel plays in property transactions.
A property report by lawyer can help consumers
- Understand Legal Frameworks: We observed that only 1 in 10 urban property buyer fully understands the complex legal frameworks surrounding property transactions. Legal professionals can guide buyers through these complexities.
- Identify Potential Risks by Conducting Due Diligence: It is estimated that nearly 18% of all the residential properties in Indian cities have some for of legal issues. Real estate lawyers can spot the hidden pitfalls in property transactions with comprehensive due diligence.
Sunil's story serves as a stern reminder of the potential risks of not obtaining appropriate legal advice when buying real estate.
Landeed makes it easier for you to access expert legal assistance for your property transactions, ensuring a transparent and secure real estate investment. Remember, a small step towards legal due diligence can ensure a giant leap towards a secure real estate future.
Post by Akanksha Patel
