Process Of Buying a New House in India

Buying a house can be an overwhelming experience, both financially and emotionally.  Right from financing the purchase to selecting the builder, it encompasses numerous aspects. To help you through the process, here we share with you a step-by-step guide to buying a house.

Step 1: Determine your budget

The initial step involves determining your budget for a new home. Factors such as your income, savings, and existing debt obligations should be considered. Before embarking on the property purchase journey, it’s crucial to assess the necessary cash reserves, your eligibility for a loan, and potential lenders. Typically, a down payment of 10 to 20% is required at the time of booking. It’s generally advised that individuals seek homes costing no more than three to five times their annual household income, deducting the down payment. Besides the property cost, additional expenses like stamp duty, legal fees, and property tax need to be taken into account. Clearly define your investment plan for the property.

Step 2: Choose the right location

Once you have established a budget, the next step is selecting the optimal location for your new home. Consider factors such as its proximity to your workplace, the availability of public transportation, and access to essential amenities like schools, colleges, hospitals, public parks, shopping complexes, and attractions. Explore locality review section here and know everything about different localities of Pune like Hinjewadi, Kharadi, Wakad, Baner , Magarpatta City etc.

Step 3: Decide on the type of house

It’s essential to decide on the type of dwelling that aligns with your preferences, whether it’s a 1BHK, 2BHK, or 3BHK apartment, a studio apartment, an independent house, or a villa. Each housing option comes with its own set of advantages and disadvantages, so it’s crucial to choose the one that best suits your lifestyle and fits within your budget.

Step 4: Research the market

Once you’ve settled on both the type of house and the location, it’s important to delve into the real estate market. Conduct thorough research to identify the types of houses available within your budget. Compare prices, amenities, and features of different properties to make an informed decision. Also check upcoming infrastructure developments in your interested localities of Pune like Ring Road, Metro Lines, Purandar Airport etc.

Step 5: Find a reputable builder/developer

Selecting a reputable builder or developer is crucial when purchasing a new house. Prior to making a decision, thoroughly research the builder’s reputation, experience, and track record. Check for any legal cases against the builder or developer, read reviews from existing buyers of the same project, and confirm whether the project is approved by leading banks in India. This diligence ensures a more secure and informed decision in your home-buying process.

Step 6: Check the legal documents, MahaRERA Compliance

After identifying the desired property or house, the subsequent and pivotal step is to engage a lawyer to thoroughly examine all property-related and legal documents. These documents encompass the title deed, land use approvals from the municipal corporation, encumbrance certificate, and occupational certificate. The due diligence phase in real estate constitutes a critical aspect of the homebuying process. Of utmost importance is verifying the ownership rights of the seller and confirming their authority to sell the property to you. For under-construction properties, scrutinize the credibility of the builder and ensure that the development is lawful, with all sanction plans duly approved. Opting for properties registered under RERA (Real Estate Regulatory Authority) is recommended, providing a recourse to the regulator in case of disputes.

Step 7: Sale Agreement

In the case of an under-construction property, the developer typically allocates a flat to you after you make the down payment. The sales agreement is then finalized as the project approaches completion and the payment plan has been executed.

This agreement serves as a contract that officially confirms the sale of the property to you and outlines specific details about your unit. It’s crucial to meticulously cross-check that all the commitments made to you, including the price, square footage, delivery date, and any penalties for late delivery or payment, align precisely with what was agreed upon with the developer. This thorough verification ensures that the terms and conditions are in accordance with your expectations before finalizing the property purchase.

Step 8: Property Payment

Once you have collected the necessary documents and had them e-stamped, the next step is to submit the loan application form. Ensure that you attach all the required documents related to the property and your income along with the application. This comprehensive submission is essential for the loan processing and approval process.

Step 9: Registration

Another crucial step in the home buying process is obtaining e-stamps for the sales agreement. In the case of ongoing construction, two separate agreements are typically created—one for sales and another for construction. Both of these agreements should undergo the e-stamping process, ensuring compliance with legal requirements and facilitating a smoother transaction.

Property registration process and office addresses from Pune

Step 10: Possession of the property

Upon the completion of registration and the full payment of consideration by the buyer to the seller, the buyer gains possession of the property. The possession date is clearly stipulated in the sale agreement, and it is incumbent upon the seller to hand over the property to the buyer on or before this specified date. Before signing the house purchase agreement, it is imperative for the buyer to have a precise understanding of the possession period. Additionally, the buyer should verify whether the property is in the same condition as agreed upon in the sale agreement before taking possession. This ensures that the property transfer aligns with the terms and conditions initially established in the agreement.

Step 11: Transfer of ownership/utilities with local authority

The ultimate step in the home-buying process involves registering the house in your name in the local municipal records, change name on property tax bills, electricity bills, society share certificate, society transfer etc. This crucial step finalizes the legal transfer of ownership and officially recognizes you as the rightful owner of the property in the municipal records.

Conclusion

The legal process of buying and selling a house in India encompasses various steps, including title verification, the creation of a sale agreement, payment transactions, registration, taking possession, and transferring utilities. It is imperative to navigate these steps with precision to steer clear of potential legal disputes or complications in the future. Seeking the expertise of a lawyer and a reliable real estate agent can greatly contribute to a seamless and hassle-free experience in the buying or selling process.

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