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Old 21st October 2022, 19:53   #2641
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Re: The Property / Real Estate Thread

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Originally Posted by balenoed_ View Post
Is this true for plots as well?

... is there any disadvantage in quoting this low value, aka, the guidance value in agreement than the actual sale price?
the guidance value is close in some cases, but in other cases it is lower than market prices.

Regarding the values you asked - True for all real estate - including plots, industrial or agricultural lands. The sale agreement cannot be below the guidance value, but can be higher. Registration charges will be in line with the quoted value. Also, your capital gains will be in line with this sale value.

For most properties, the guidance value is listed online also. The correct information will be available at the Sub-Reg office and often with agents/real-estate agencies. I have seen this list online, but dont remember the site.
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Old 21st October 2022, 20:31   #2642
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Re: The Property / Real Estate Thread

- Firstly - every builder is businessman however branded. Don't fall to their chikni chupadi batein (sweet talks) plus the fancy brochures and seasoned marketing guys who knows how to take it ahead
- as mentioned by few folks above, see for a category 1 or 2 builder only and not below
- Pay some token amount say 10k or so and get the required documents, All these will be copies though
- Get a good property lawyer to check up the paperwork and the one who has dealt with property matters before. Bear in mind that lawyer will share a written document stating - "as per the documents shared by the client these are the findings etc" if you need specifically anything you have to ask to look for
- Expect delays in most projects irrespective of the brand - plan accordingly. Their reason will be such that you cannot contest it (covid, truck strike etc.). Rarely, builders provide on-time completion
- Check room measurements as it is usually lesser or more, but it will not reduce your final price
- IMP: Check where the STP plant will be as it makes noise and sometimes smell comes though not a very big deal but sometimes a irritation
- in almost all the builders there is floor raise price hike of 50-100. This you can negotiate
- Avoid booking top floors as far as possible - my experience
- Carry a cheque book always and make then to realize that you want to book it today itself.
- Check the floor plan, overall plan, look s for where is planned what.
- Start paying full EMI from Day 1 as the shift from partial payment to full hurts
- Release payment after you do a check as sometimes builder asks for amount anticipating a date of completion of a floor which may not be the case
- Modification with big builders are either a NO or will be costly.
- Check all that promised plus the modifications plus the promised brand fittings. Once handed over its difficult to catch hold.
- Registration is a daylong affair and all actual and plus amounts will be added to be paid
- As soon as you have registered, get a true copy (for address proof) signed by the registrar. there is a cost to it like 100/- but the actual "amount" differs. The original copy will be taken by builder and handed over to hypothecated bank for safe custody for next 15-20 yrs.

Post --
- Get all the documents like electricity transfer, related documents of ownership, occupancy certificate or equivalent etc and in all these documents check for the correctness of the names of all those who are registered

- Keep a separate excel for all the expenses incurred. Consider all that is needed. You get only skeleton flat and then your job starts for interior (check for better one), all accessories like fans bulb etc. (i had forgotten to consider fans, bulbs, tube light etc. and had to run at last moment )

- Once EMI starts, see if you can pay around 10k more than the actual which will help to reduce the principal loan amount or pay once a year a lumpsum to reduce the loan principal. Helps in reducing the tenure

- and so on. If I remember more, will add more
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Old 21st October 2022, 21:31   #2643
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by balenoed_ View Post
Is this true for plots as well?

Otherwise, is there any disadvantage in quoting this low value, aka, the guidance value in agreement than the actual sale price?

The advantage being that the registration charges also tends to be less as it depends on this and I guess that is the usual practice.
By "agreement", do you mean buyer and seller are signing a registered sale agreement prior to the actual registration?

In that case, there is a disadvantage for the seller by quoting the lower guidance value (GV) compared to the actual sale price (ASP). The GV is the minimum amount that the buyer has to show a legal source for aka white. The remaining amount (ASP-GV) is paid in cash. In the event registered sale agreement is for the GV but the seller has taken some advance (ADV) and that is also mentioned in the agreement, the buyer can delay the registration and drag the seller to court and take possession of the property by paying only the balance mentioned in the agreement (GV-ADV). The seller needs to understand very clearly that they are legally agreeing through the sale agreement for a lower price than the ASP. Oral agreement may be for ASP but what is enforceable through court is always the registered sale agreement. Also, unregistered sale agreements may be admitted by a court in case of dispute as a form of evidence it doesn't carry too much weight.

A seller should always go for a registered sale agreement mentioning only the GV, IF and ONLY when the buyer has paid the rest (ASP-GV) in cash and the GV value will be paid by means of DD or RTGS at the time of registration. Not every buyer is obtuse like that but I have seen multiple cases where an unsuspecting seller is cheated this way by an unscrupulous buyer.
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Old 21st October 2022, 22:16   #2644
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Re: The Property / Real Estate Thread

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Originally Posted by condor View Post
the guidance value is close in some cases, but in other cases it is lower than market prices.
Quote:
Originally Posted by green_ninja View Post
By "agreement", do you mean buyer and seller are signing a registered sale agreement prior to the actual registration?
Very clearly explained, Thanks.

Yes, by agreement I meant buyer and seller signing a sale agreement with GV.

And my query is from a buyer point of view.

For eg: The Actual Sale Price of a plot is going to be 75L. But the current GV of the plot is ~30L and the agreement is going to be made with 30L, and hence attracts a much lesser registration charges than what it would have been if ASP (75L) was put in agreement.

So from buyers stand point, is there any disadvantage in doing this way, than having an advantage of having a lesser registration charges.
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Old 22nd October 2022, 00:03   #2645
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Re: The Property / Real Estate Thread

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Originally Posted by balenoed_ View Post
So from buyers stand point, is there any disadvantage in doing this way, than having an advantage of having a lesser registration charges.
If you are planning to sell the plot after a few years, then your LTCG will be more. Let's say you sell the flat for 1cr after 3-4 years, your long term capital gain will be 70L as per the records and will be taxed accordingly. To avoid that, you have to again follow the same route and find a buyer who will give you 50% in cash.

Last edited by Aditya : 22nd October 2022 at 17:19. Reason: Quoted text trimmed
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Old 22nd October 2022, 06:54   #2646
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by balenoed_ View Post
So from buyers stand point, is there any disadvantage in doing this way, than having an advantage of having a lesser registration charges.
Answer:
Quote:
Originally Posted by Everlearner View Post
If you are planning to sell the plot after a few years, then your LTCG will be more.
Suggested solution, like how we are doing for one site:

Talk to the seller and find the max value for which the current seller will not have to pay LTCG. Register the sale for that price. This way, your LTCG when you sell will be lesser than what it could be if you register at GV today.
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Old 22nd October 2022, 09:15   #2647
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by balenoed_ View Post
Very clearly explained, Thanks.

Yes, by agreement I meant buyer and seller signing a sale agreement with GV.

And my query is from a buyer point of view.

For eg: The Actual Sale Price of a plot is going to be 75L. But the current GV of the plot is ~30L and the agreement is going to be made with 30L, and hence attracts a much lesser registration charges than what it would have been if ASP (75L) was put in agreement.

So from buyers stand point, is there any disadvantage in doing this way, than having an advantage of having a lesser registration charges.

From a buyer's perspective, I don't see any disadvantage with this arrangement. It saves you a lot on registration and stamp duty.

However my rule of thumb with real estate transactions has always been to go straight for registration as soon as possible without the hassle of an agreement. A lot of things change during the agreement period that leads to further complications. Don't drag it unless absolutely necessary.

LTCG is not an issue as most prospective buyers (>90% in my experience) will opt for only current GV and not the ASP. Real estate transactions especially for plots don't go for bank loans as much as constructed buildings. So cash is still king.

Off course this could all change if government policy regarding cash transactions becomes more stringent and it becomes almost impossible to do so.
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Old 22nd October 2022, 09:59   #2648
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Re: The Property / Real Estate Thread

I am loving the tax evasion point of view in the past few posts. No offence meant.

But I don't know what to do. We pay 10 to 30% income tax invest savings, then pay capital gains while liquidating the savings to buy immoveable property and then pay 10-15% stamp duty on the purchase value (and still the government says that the registration does not guarantee anything - not even legality of the building clearances*. And I know a person who lost his land 25 years after purchase because there was a court attachment 10 years prior to his purchase and court attachments will not be registered and even if registered, will not turn up in encumbrance / index searches).

Effectively, the government taxes is upto 50% for land transactions, (income tax, capital gains, stamp duty and registration, etc). And I have not factored in tax on savings till those are v liquidated. And wealth tax has been ignored.

Sigh.
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Old 22nd October 2022, 11:56   #2649
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Re: The Property / Real Estate Thread

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Originally Posted by BaCkSeAtDrIVeR View Post
I am loving the tax evasion point of view in the past few posts. No offence meant............

......Sigh.
Unfortunately, that is the harsh reality of the times we live in. The whole GV, stamp duty and registration fees system is fine tuned for politicians to economically park their ill gotten wealth while extracting the maximum from the law abiding citizen to fill government coffers.

A few years back, my home state TN reduced GV by 33% but increased stamp fees by from 8% of registered value to 11%. While being revenue neutral for GoTN, this created a further divergence between market value and GV. They could have just as easily increased GV while reducing stamp fees and stayed revenue neutral but that would mean our local thalaivars show larger legal sources for their RE purchases. Can't have that now...can we?
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Old 30th October 2022, 20:35   #2650
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Re: The Property / Real Estate Thread

Any reviews on Shapoorji Pallonji Parkwest 2.0 at Binnypet, Bangalore? It's been 13 years since I purchased my current property that I am living in (a 3 BHK at Kadugodi), so looking to sell that off and invest the proceeds into something worthwhile.
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Old 2nd November 2022, 21:58   #2651
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Re: The Property / Real Estate Thread

I am looking for some advise. We have a flat in Bombay which is locked. Parents and siblings are with me in Canada. I get limited vacation time to travel there. When I do, itís just repairs and upkeep which keeps me busy.

We have decided to sell the place but unsure of how to go about it. We have no family in india. I have some friends who have recommended brokers.

My question is, how safe is it to give the keys to the broker for showings? My friends tell me that things have changed since before where once you give the keys you are done.

Is that the best way? Any suggestions of anything in writing to be done with broker if I decide to give the keys?
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Old 3rd November 2022, 01:03   #2652
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Re: The Property / Real Estate Thread

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Originally Posted by Raj1008 View Post
My question is, how safe is it to give the keys to the broker for showings? My friends tell me that things have changed since before where once you give the keys you are done.

Is that the best way? Any suggestions of anything in writing to be done with broker if I decide to give the keys?
I recently interacted with a property management company in my hometown in Kerala. They claim to provide end-to-end services, whether you want it to be just cleaned and maintained, rented out, or sell it. We have to get into a legal agreement with the firm and they take care of the rest. Appeared very professional compared to the normal brokers, but I have not done further research.

I am sure Mumbai would have many such agencies. This is a big business now that many people are staying away from their hometowns but still hold on to their homes for whatsoever reason.
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Old 3rd November 2022, 07:53   #2653
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Re: The Property / Real Estate Thread

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Originally Posted by Raj1008 View Post
We have a flat in Bombay which is locked. ..
We have decided to sell the place but unsure of how to go about it.

My question is, how safe is it to give the keys to the broker for showings?
You have not mentioned the size of the building. Brother has a flat that is a little away from where we live, and for all such work we take help of the maintenance manager. It also helps that the guy has been around for a long time, and the complex is not too big.

You could alternately request the neighbours in the building to help out by holding the key on your behalf.

Else, find which of the brokers can give an end-to-end service. If you use this, you will need to stick to one broker and let him have the key.. you may not be able to compare offers through diff parties.
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Old 3rd November 2022, 11:47   #2654
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by Raj1008 View Post

My question is, how safe is it to give the keys to the broker for showings? My friends tell me that things have changed since before where once you give the keys you are done.

Is that the best way? Any suggestions of anything in writing to be done with broker if I decide to give the keys?
You can install a safe key box outside the flat (something like this) Give the password to either broker or the prospective buyer directly. Additionally post the visit, you can reset the password with help from your friends.
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Old 3rd November 2022, 23:21   #2655
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Re: The Property / Real Estate Thread

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Originally Posted by green_ninja View Post
LTCG is not an issue as most prospective buyers (>90% in my experience) will opt for only current GV and not the ASP. Real estate transactions especially for plots don't go for bank loans as much as constructed buildings. So cash is still king.
Just a follow up question on this.

Actually this is going to be with a plot loan. So, say if I have put 30-40L (GV) in the sale deed and pay stamp duty accordingly, but actually paying the seller the ASP (~75L), through bank loan, is that legal and ok to do? Any cons with that arrangement?
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