[Jaguar]

Originally Posted by whitewing

For the attention of property owners in Bengaluru.
https://thebengalurulive.com/now-you...y-scrap-value/

This made rounds in our apartment group as well but I am still confused. I have got a Katha certificate for my property. Just because BBMP is digitizing it doesn't mean the physical certificate will become scrap. Granted, for future transactions, it will not be required.
And as a property owner is there anything that I need to do (immediately)? Any change to how tax payment is made? Or does this only impact when buying or selling a property? So many open questions that these news articles have not answered.

[whitewing]

Originally Posted by Jaguar

This made rounds in our apartment group as well but I am still confused. I have got a Katha certificate for my property. Just because BBMP is digitizing it doesn't mean the physical certificate will become scrap. Granted, for future transactions, it will not be required.
And as a property owner is there anything that I need to do (immediately)? Any change to how tax payment is made? Or does this only impact when buying or selling a property? So many open questions that these news articles have not answered.

As usual, the headlines are sensational.

My reading of the newslink -
a) Eventually, the current Katha will become void and has to be replaced with the new one. Anyone's guess how many months/years this would take.

b) If one has a property in one of the guinea pig wards and need to perform a RE transaction, then one would have to contact the BBMP as described in the link and get a new katha issued.

[vinu_h]

I've got an A khata with me. It's got property details, BBMP signatures & seals and is hand written. I had to pay nearly 100% bribe for it.

How to verify if the Khata issued by BBMP is valid or not ?

[StrangeWizard]

Had a query regarding TDS on sale of property. I purchased a new property and paid the TDS online last night (form 26QB) through the netbanking option. I logged into my SBI account and after verifying all the details, a message popped up saying that the amount will be debited the next day (today) and the transaction got scheduled.

Today, the amount got debited but when I look up the TRACES website for Form 16B, it says no data available. Also, because this was a scheduled transaction, I haven't really got a challan counterfoil number which you generally get as soon as you make the payment. How to go about it now? Any idea how much time does it generally take for the details to be updated on TRACES.

[Rajeev1]

Originally Posted by StrangeWizard

Had a query regarding TDS on sale of property. I purchased a new property and paid the TDS online last night (form 26QB) through the netbanking option. I logged into my SBI account and after verifying all the details, a message popped up saying that the amount will be debited the next day (today) and the transaction got scheduled.

Today, the amount got debited but when I look up the TRACES website for Form 16B, it says no data available. Also, because this was a scheduled transaction, I haven't really got a challan counterfoil number which you generally get as soon as you make the payment. How to go about it now? Any idea how much time does it generally take for the details to be updated on TRACES.

It takes about 10-15 days for the transaction to get reflected in TRACES and for Form16B to be generated.

SBI will be able to provide you with the "Challan Number" if it is not available through your netbanking channel. Contact the bank (walk in or call centre). The challan number will be required for the Form 16B generation.

Another alternative is for you to wait for 7-10 days after which this tax payment transaction will get posted to your Form26AS. You can login and pull out your Form26AS - which will have the challan / payment details of tax.

[revverend]

Disclaimer - I am a dud when it comes to real estate and this extends to my parents also. We have made a handful of investments in the past which have tanked, some miserably.

With that in mind, me and my spouse are looking to invest in a flat in hyderabad, for my parents to spend their post retirement phase. My parents are currently staying in a rented flat in a decent area (Gandhinagar) in Hyderabad, for the past 20 odd years. The current age of the building is 27 years. A spacious 3BHK has been put up for sale in the same building and all of us are leaning towards it given the familiarity with the area, the apartment and the surrounding ecosystem as such. Also, this is available at atleast 30-40% lower rates compared to a resale flat in a newer building with amenities.

I wanted to get your thought/guidance on :

1. Is it worthwhile investing in a 27 year old flat with an outlook that it might appreciate/not depreciate 10 years down the line ?

2. This is going to be the only property that we will own in the long run, pretty much all our savings dunked into this. What happens in a worst case scenario that the building becomes unlivable after a point ?

3. Will banks be forthcoming to give a loan for an older property ? I checked with Union bank and State Bank who rejected the request saying maximum building age should be less than 25 years

Sorry if my questions sound very basic, but we want to be sure of taking a wise descision, albeit an informed one. A decent 3 BHK flat in a gated community, recent construction are all out of our budget (~5K to 6K per sq.ft) as compared to this one at ~4K per sq.ft.

Cheers
Revverend

[ValarMorghulis]

Originally Posted by revverend

...
1. Is it worthwhile investing in a 27 year old flat with an outlook that it might appreciate/not depreciate 10 years down the line ?

2. This is going to be the only property that we will own in the long run, pretty much all our savings dunked into this. What happens in a worst case scenario that the building becomes unlivable after a point ?

3. Will banks be forthcoming to give a loan for an older property ? I checked with Union bank and State Bank who rejected the request saying maximum building age should be less than 25 years...

I would say:
1. Pass on this. Too old a flat to invest in
2. Seriously, pass on this especially if you are going to put all the eggs in one basket
3. Banks generally take the flat as a collateral. If even they aren't confident about this, I think that conveys the message

[androdev]

Originally Posted by revverend

1. Is it worthwhile investing in a 27 year old flat with an outlook that it might appreciate/not depreciate 10 years down the line ?

Not a good idea but can be a good option under certain circumstances:

1. Apartment comes with a generous amount of "undivided land share" so that intrinsic value is good. Think of it as buying the land and apartment is worthless. You will not get a bank loan unless this condition is met.

2. Objectively, you find the apartment to be a much better project than what you would get for the same price. One indication of this would be a good rental demand for it.

Don't buy it just because of familiarity unless it's just a casual purchase.

[hondafanboy]

me and my spouse are looking to invest in a flat in hyderabad, for my parents to spend their post retirement phase.

1. Is it worthwhile investing in a 27 year old flat with an outlook that it might appreciate/not depreciate 10 years down the line ?

You know the city and the area well so you may be able to look at the crystal ball and see the future 10-15 years down the line. Check how the nearby areas developed over the last 10 years. If there is a possibility of this area being developed in the next 10-15 years then may be worth buying something there at the cheaper rate, even if the building is old. Typically RCC constructions lasts 40-50 years and if the quality of the material and the building design is good it could last beyond that as well. So in your case, its just a number if you know 1) that area is developed/developing , is safe and accessible to workplaces, schools etc. If the same 27 year old building was in the Banjara hills or Jubilee hills then the building age would not matter from the investment or appreciation point of view. Would it ? So give more thought to the area/location , if needed show the building and the flat to someone who is in the construction business. Based on what I heard and saw , building designs, floor plans, and construction quality is quite good in the south. May not be true for newer constructions.

Now the building age maybe an issue from the home loan point of view but i think if the building and flat is in top condition then the banks should be able to offer loan on it, especially in the current times. I would suggest to list all home loan providers who have their offices in that area and approach them one by one. Show them your CIBIL scored, you already have co-applicant, and also if you are able , tell them that you will do more than 20% down
payment. Hopefully some bank will come forward to lend the remaining amount.

I think the important part is you are looking for the property for consumption i.e. for your parent , so you should not mix with the investment.

Figure out your parents needs and things that are necessary for them going forward. Do they need 3 bhk ? Again based on what I heard and saw, unlike in Pune or Mumbai , flats are quite spacious in down south. 3bhk in Pune is 2bhk is Hyderabad. So may be you can look for a 2bhk which is easy to navigate from the usability, maintenance point of view. And also in the much safer area, has good hospitals nears by and also Park, temples etc. And if the current flat and the location meets this criteria then why not. The building age can also turn in your favour in terms of savings or negotiations with the seller.

All the best. Its quite nice that you are buying a house for your parents. Nothing can or will go wrong with this purchase. Just apply basic principals i.e. budget, building and the flat is safe to live and parents needs considering their age etc.

[revverend]

Originally Posted by ValarMorghulis

I would say:
1. Pass on this. Too old a flat to invest in
.
.
.
I think that conveys the message

Thank you for a pragmatic view on this @ValarMorghulis. Appreciated

Originally Posted by androdev

Not a good idea but can be a good option under certain circumstances:
.
.
.
Don't buy it just because of familiarity unless it's just a casual purchase.

Familiarity breeding a false sense of safety from an investment perspective, given our history with real estate investment choices. Coming to UDS, I have done a bit of asking around and seems like the UDS is very small compared to the apartment size. And the last point, this apartment is not a better project in terms of amenities but definitely better in space, compared to a similar project at the same cost. Thank you for your guidance @androdev

Originally Posted by hondafanboy

You know the city and the area well so you may be able to look at the crystal ball .
.
.
building and the flat is safe to live and parents needs considering their age etc.

Thank you for the wonderful words. You bring up an interesting point of what happens to this area 10 years down the line. Going by historical trends, the land rates have appreciated over the past decade (not considering the usual inflation) , the place has become more crowded and pretty much nothing else has changed. Now if I have to extrapolate it to 10 years down the line, I definitely need to talk to more people around here to get a pulse check.On your point of mixing consumption and investment, honestly me and my spouse can afford only one house in the long term. And this is it. While our parents make this their home for the foreseeable future, we definitely would not want an asset to depreciate, especially when the EMIs pinch your pocket every month.

I agree with the comparison of flat sizes up north and down south and I have personally lived in various cities around India. That said, the newer flats down south are also shrinking in size while the rates keep pushing the ceiling. I feel it will normalise across the country, atleast for flats in urban areas. We will definitely re-evaluate our needs again

Thank you again !

[nik0502]

Dear BHPians

I am looking for some advice on an investment I made 7 years ago. As everyone of us dream about owning our first car and I am sure most of us did dream about our first home as well. So this purchase was a result of same dream. I bought a 1 BHK flat in 2013. It was under CLP. Luckily the builder completed the project before time and I got possession in 2017. The property costed me 20+ lacs. I have an outstanding of 11 lac on loan on this property. The loan was disbursed when I got the possession. Now the property prices have tanked. And I am being offered 10-11 lacs max for the same property now. Some dealers even quoted 9. I bought another house in 2019 which is serving the purpose of my housing needs and I am very satisfied with this purchase. The question I have for the experts is should I retain the first property or should I sell it at whatever price I am getting.

Few points to add -
The property is in Bhiwadi city which is a 55 Kms drive from Gurugram and it’s an industrial area having plants of Honda and Toyota.

There is a railway track being laid down right next to the society.

I love the society it has every facility and very well maintained.

Currently it’s on rent but the rental value hardly makes up for 33% of EMI or 50% of the yearly interest I pay on the loan.

The prices have not increased even by 50K since I have got the possession (2017). Infact if I believe the local dealers they are going down due to railway track.

If I sell it now I would be taking a loss of about 10 lacs or about 45% of the actual cost. At the same time I will save on the interest I am paying on the loan plus I can use the extra monthly cash to repay my current home loan early and save on interest there also.

[vinu_h]

Originally Posted by nik0502

The question I have for the experts is should I retain the first property or should I sell it at whatever price I am getting.
.

Was in a similar situation. Do not sell unless you need the cash. Property rates are going up. HOLD

[sunilch]

Originally Posted by nik0502

The question I have for the experts is should I retain the first property or should I sell it at whatever price I am getting.

Selling at such deep discounts is done only when you urgently need the money. Otherwise, if the property is giving you some rent after covering your maintenance expenses, keep it. Eventually it will get better than what you are getting now.

[nik0502]

Originally Posted by sunilch

Selling at such deep discounts is done only when you urgently need the money. Otherwise, if the property is giving you some rent after covering your maintenance expenses, keep it. Eventually it will get better than what you are getting now.

I do not need money at this moment however I am paying EMIs for both the properties and because of which I am unable to save. Also at the same time the liabilities give me sleepless nights. If I sell it today I would be able to bring my liabilities down by 40% within an year. I don’t have any other loan apart from the loans on these two properties. Also I have been hoping to get better returns but it’s been seven years I haven’t seen it becoming better even for a day. Prices stated going down within six months of my purchase. When I bought it there was no property at similar price. But I have been trying to get rid of it since 2014 and have been waiting since then to get something better. I had paid 20% as down payment and I could have simply said no at the time of possession and could have walked away with few lacs loss but I hoped it would get better and got the loan disbursed and the prices haven’t moved even by a rupee in all these years. And I have multiplied my losses in this hope of getting a better deal. More than money it’s a mental block for me. That’s the reason I am looking for advice keeping my emotions aside want to know what makes sense.

[sunilch]

Originally Posted by nik0502

I do not need money at this moment however I am paying EMIs for both the properties and because of which I am unable to save. Also at the same time the liabilities give me sleepless nights. If I sell it today I would be able to bring my liabilities down by 40% within an year. I don’t have any other loan apart from the loans on these two properties. Also I have been hoping to get better returns but it’s been seven years I haven’t seen it becoming better even for a day. Prices stated going down within six months of my purchase. When I bought it there was no property at similar price. But I have been trying to get rid of it since 2014 and have been waiting since then to get something better. I had paid 20% as down payment and I could have simply said no at the time of possession and could have walked away with few lacs loss but I hoped it would get better and got the loan disbursed and the prices haven’t moved even by a rupee in all these years. And I have multiplied my losses in this hope of getting a better deal. More than money it’s a mental block for me. That’s the reason I am looking for advice keeping my emotions aside want to know what makes sense.

Ok so you have two Home Loans going on at present and I agree that it may become a difficult situation to manage if something happens to your cash flows. How long do you have the first loan to service? If not a lot, try to manage it as selling it at 50% loss may not help much.

Otherwise, calculate how much you will get in hand out of this sale, after deducting all associated expenses. Then calculate how much you will save in terms of interest on your second loan if you repay this amount into the second loan. If the figure is substantial, and there is no association that you want with the first property then you should sell and sleep peacefully. But if you have any other association with the first property - emotional or any other, then the odds are in favor of keeping it.

Regarding getting sleepless nights due to EMIs - been there, faced it. Let me share my experience. I still have huge EMIs and this Pandemic (along with may other emergencies that I faced in 2020) have given me sleepless nights. I was sleepless during first couple of years of my loan undertaking. But - All this is part of the game and is simply about keeping patience. Not being able to save for a while is ok as long as you are able to pay your due EMIs. You bought property because you wanted to have a property for emotional reasons. When you come out of this (say one loan gets over) you will feel proud of yourself. The property is only 3 years old (from the date you got the possession) and hence it will retain its value and may appreciate in coming years when things get better. Rents, in all normal scenarios, increase YoY and home loan rates are very low these days.

So have patience and keep a pulse on the market. If a good opportunity arises, then sell. Else keep walking. And if anything wrong happens, you can do a fire sale anyway.