There are four types of properties in the Indian real estate industry – commercial, residential, industrial and agricultural.
As the real estate segment is evolving, there are people who revamp their commercial properties to make them residential ones. As properties are clearly demarcated as per their usage, can you use a commercial property for residential purpose?
The reason can be anything like need for different space, saving money by having commercial and residential property as single unit or want a preferred location. While there may be benefits associated with your decision, but there are also legal angles that come along if you explore the option of staying in a commercial property.
Lets learn how a company can buy a residential property in India
What is a commercial property?
A commercial property is a piece of land used for commercial development or business purposes. These may include offices, retail stores, industries, and warehouses sold or leased to companies.
Residential property vs commercial property
| Residential property | Commercial property |
| This property is used for residing or staying. | This property is used for business-related activities. |
| Residential zoning laws apply to residential properties. | Commercial zoning laws apply to commercial properties. |
| Insurance will be with respect to residential property. | Insurance will be with respect to commercial property. |
| Residential lease agreement applicable. | Commercial lease agreement applicable. |
What does the commercial zoning rules state?
As the name suggests, these are government set rules that control the use of land in a specific zone. These rules give the permission associated with the commercial properties, such as using it for residential, commercial, industrial, or agricultural purposes. Commercial zoning applies to large businesses like factories and malls. These are divided into smaller categories, such as offices, retail, restaurants, etc., and there are rules associated with each of them. It is important to follow the zoning rules laid by the government.
Can you stay in a commercial property?
- You may stay in a commercial property based on the local zoning rules, and the planning permission in the locality. Also, adhering to safety standards with respect to residential use is a must.
- In case of mixed-use development, you may use a commercial property as a residential one. However, it is necessary to get all the required permissions and comply with the local building codes.
The lease agreement and insurance associated with residing in a commercial property may differ, hence it is important to do groundwork before proceeding.
Legal issues you may face if you reside in a commercial property without permission
- If you don’t comply with zonal regulations, you may face penalty and legal actions, such as attachment of the property.
- Living in a commercial property may affect the insurance coverage you may be eligible for.
- It may also have tax implications.
- Before staying in a commercial property, check with a lawyer whether the documents you have comply with the zonal rules and the local building codes.
Housing.com POV
While living in a commercial property is useful and advantageous, you may not always be able to stay in one frame owing to compliance issues. Thoroughly check if there are no violations on your side for getting a residential space in a commercial domain.
FAQs
Can you convert a residential property into a commercial space?
You can convert a residential property into a commercial space by seeking specific permissions from the local authorities and complying with them.
Which is better -- investment in commercial or residential properties?
This depends on you. A commercial property may give you higher rental yield and long-term appreciation as compared to residential one. The residential property is important if you want it for personal use, or you do want to manage an office space and would rather prefer to be an investor in the residential realty segment.
Is it legal to stay in a commercial property?
While in many cases, it is not allowed to stay in commercial properties as they are developed with an intent to promote commercial activities. There are exceptions, where based on the building codes and zonal rules, you may be allowed to stay in such accommodation.
What is mixed-use zoning?
Mixed-use zoning allows the use of commercial and residential properties in the same zone.
What are the disadvantages of staying in a commercial property?
The balance of promoting commercial activity in a commercial property may be disturbed in case of residential settlement there.
| 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 Ghosh |
