Looking to buy a new home that’s still being built? Asking the right questions can help you make a smart choice. When you’re looking at under-construction properties, it’s important to know what to ask the builder. These questions can give you peace of mind and help you understand what you’re getting into. From timelines to quality, here are the top 10 questions to ask your builder before you buy.
See also: How to be legally secure when buying an under-construction property
Legal questions and details
Is the project approved by all the necessary authorities like RERA and local municipalities?
When purchasing an under-construction property, it’s crucial to verify several legal approvals. The RERA Registration is paramount as it ensures transparency and protects your interests. Verify the registration number on your state’s official RERA website to confirm the project’s legitimacy and to have access to a dispute resolution mechanism if needed. Local municipal approvals are essential, including the Building Plan Approval, which ensures compliance with zoning laws, safety standards, and infrastructure needs. The Land Use Certificate confirms that the land is designated for the type of development planned, whether residential or commercial. For larger projects, Environmental Clearance is necessary to ensure there is minimal impact on the environment. Fire Safety NOC ensures compliance with fire safety regulations, while Water and Sewerage NOCs confirm access to essential utilities. Request copies of all these approvals to allow a legal professional to verify their authenticity and completeness, ensuring your investment is protected and the property meets regulatory standards.
What is the expected completion date for the project? Have there been any delays in your past projects, and if so, why?
When buying an under-construction property, it’s important to clarify certain details. Firstly, ensure the Expected Completion Date is clearly stated in your sales agreement, as mandated by RERA regulations. It’s wise to research the builder’s track record of completing projects on time by checking references and online reviews from previous buyers. Understanding any past delays and their reasons is crucial—whether they were due to unexpected issues or a recurring problem with the builder. Lastly, inquire about the construction phases and their timelines to track progress and anticipate potential setbacks in your project’s development. These steps can help you avoid financial strain and ensure your future home is delivered as promised.
Financial questions
What is the final cost of the property, including the base price, GST, maintenance charges, parking fees, and any other hidden charges?
When you’re buying an under-construction property, it’s crucial to understand the total cost breakdown. Firstly, there’s the base price, calculated based on the area of your unit. It’s advisable to negotiate this price if possible. In addition, there’s a goods and services tax (GST), currently set at 5%, which is added to the base price. Maintenance charges are another consideration, covering upkeep of common areas, security, amenities, and staff salaries. It’s important to ask for a detailed breakdown of these fees to ensure they’re sustainable. Parking Fees, for both covered and open spaces, are often separate costs. Be aware of other potential charges like club memberships, floor rise fees for higher floors, or power backup charges. Request a comprehensive document detailing all costs and the payment schedule to avoid any surprises and effectively plan your budget.
What is the payment schedule? How much is the down payment, and what are the terms for the remaining installments?
When buying an under-construction property, understanding the payment plan is crucial. Firstly, there’s the Down Payment, which is typically 10-20% of the total cost and is required to book the property. The remaining amount is paid in installments linked to the construction progress, such as when specific milestones like the foundation or plinth are completed. It’s important to know the interest rate for delayed payments, if applicable, and inquire about any flexibility in the payment schedule based on your financial situation. Compare different payment plans available and choose one that aligns best with your cash flow. Be aware of penalties for late payments and consider the impact of taking a home loan, including the monthly EMI amount, on your overall budget. Understanding these details ensures you can manage your finances effectively throughout the property purchase process.
Property and construction questions
What is the quality of materials being used in the construction? Can you provide details about the brands and specifications?
When buying an under-construction property, it’s crucial to know the materials and construction details. Ask for a detailed list of materials used for the foundation, structure, walls, flooring, windows, doors, and electrical fixtures. Look for reputable brands known for their quality and durability. Understand the structural engineering aspects, including the type of foundation and compliance with seismic zone requirements if applicable. Request a site visit to inspect the ongoing construction to assess the workmanship and materials firsthand. It’s also wise to consider hiring a qualified structural engineer to review the project plans and specifications. Their expertise can provide valuable insights into the building’s quality and safety standards.
Can I see a copy of the final floor plan for my unit? What amenities are promised, and are they included in the base price?
When purchasing an under-construction property, it’s important to review several key details. First, obtain a copy of the final floor plan for your unit to ensure it meets your spatial needs, with clear dimensions of rooms, door and window placements, and balconies. Secondly, understand what amenities are promised by the builder, such as a swimming pool, gym, clubhouse, gardens, and security features. Clarify if these amenities are included in the base price or if there are additional charges. Also, find out who will manage these amenities and how maintenance costs will be handled. Inquire about customisation options for the floor plan or finishes during construction. Finally, ask about the expected timeline for the completion of amenities to avoid any assumptions when planning your move-in.
Knowing about the builder
Can you show me some of your completed projects?
When evaluating a builder, it’s essential to examine their track record thoroughly. Start by asking the builder to show you their completed projects. Visiting these sites allows you to witness the quality of construction firsthand and speak directly with residents about their experiences with the builder, especially regarding project timelines and budget adherence. Additionally, conduct online research by checking reviews and ratings on real estate websites, forums, and social media. While opinions can vary, these reviews can provide useful insights into customer satisfaction. Lastly, look into any awards or recognitions the builder has received from industry associations, as these can indicate their commitment to high standards and ethical practices.
Can you provide me with some information about your company’s financials?
When assessing a builder’s performance in project delivery, focus on their track record with completing projects on time. Investigate whether they have a history of meeting deadlines as delays can be frustrating and costly. Also, inquire about their budget management practices—find out if past projects were finished within the agreed-upon budget to avoid unexpected expenses. A helpful tip is to request references from previous clients and speak with them directly. Hearing about their experiences first hand can provide valuable insights into the builder’s reliability and efficiency.
Development status and penalty involved
What is the current development status of the locality? Are there any upcoming infrastructure projects that might affect the area?
When evaluating a property’s location, first check its current development stage. Is it a well-established area or undergoing rapid growth? Look into any upcoming infrastructure projects nearby, like new roads or metro lines, which can affect traffic and property values. Consider essential amenities available nearby, such as schools, hospitals, and shopping centers. Also, investigate future development plans for the area, like new parks or commercial hubs, as these can influence the neighborhood’s attractiveness and property prices. It’s helpful to speak with local residents and shop owners to understand the area’s atmosphere, safety, and amenities firsthand.
What is the penalty clause in the agreement if there is a delay in completion from the builder’s side?
In your sales agreement, it’s crucial to understand the penalty clause for delays caused by the builder. This clause, often called “liquidated damages,” states how much the builder must pay you if they finish the project late. Review the penalty amount carefully, as even a small daily or monthly penalty can add up significantly if there are long delays. You might negotiate for a higher penalty amount before signing the agreement. Check if this clause is legally enforceable in your area and ask about other options if delays become excessive, like the right to cancel the agreement and receive a full refund.
FAQs
This depends on your needs and priorities. Under-construction properties are cheaper but have completion risk and delays, while completed properties are quicker to move into but cost more.
RERA registration, land ownership documents, approved building plans, project specifications, and builder-buyer agreement.
Home loan with a bank or financial institution, considering interest rates and processing fees.
Some builders may allow modifications for a fee, depending on the stage of construction.
Thorough inspection for defects, checking amenities, getting approvals, and handing over documents.
Resale on the open market or exit clause in the agreement, with potential penalties.
Down payment with staggered installments during construction, linked to completion milestones. Is a completed property or an under-construction one better for me?
What legal documents should I check before buying?
What is the best way to finance an under-construction property?
Can I make changes to the property during construction?
What should I do upon receiving possession of the property?
What happens if I want to exit the project after buying?
What are the different payment plans offered by builders?
| Got any questions or point of view on our article? We would love to hear from you. Write to our Editor-in-Chief Jhumur Ghosh at jhumur.ghosh1@housing.com |
