Times Property | 27th August 2023

At the time of buying a property the investor must ensure that all legal compliances are in place. For such an essential compliance, she/he must be aware of all such regulatory frameworks. Whereas, if he or she is buying a resale property, the power of attorney document should be checked to ensure that the property was sold or purchased by an authorisedperson. Amit Goenka, MD and CEO at Nisus Finance says, “Purchasing a home is a significant milestone in one’s life, and it is crucial for homebuyers to be aware of the regulatory compliances involved in the process. Understanding these regulations ensures a smooth and legally sound transaction, safeguarding both the buyer’s interests and the integrity of the real estate market.”

Here we will explore the key regulatory compliances that homebuyers should know before investing in a property.

Title Verification: You mustverify the property’s title. “It is vital to ensure that the seller has clear and marketable ownership rights. Obtain legal assistance to scrutinize the chain of title, search for encumbrances, and verify necessary approvals from local authorities,” Goemka adds.

Building Approvals: Confirm that the construction has received all requisite approvals from the concerned authorities. Ensure that the building possesses a valid OC, indicating compliancewith local building codes and regulations.

Environmental Clearances: For projects that may have an environmental impact, such as large-scale constructions, obtaining environmental clearances is mandatory.

Registration and Stamp Duty: To establish legal ownership, it is vital to register the property in the buyer’s name as per the applicable state laws.

Tax Compliance: Familiarize yourself with property tax obligations, including payment schedules, rates, and exemptions.

RERA compliance: RERA is aregulatory body established to protect the interests of homebuyers and regulate the real estate sector. Ensure that the project is RERA registered and complies with the necessary guidelines, including disclosure of project details, financial transparency, and adherence to delivery timelines.
Loan Compliance: If you are availing a home loan, comply with the requirements set by the lending institution. Provide all necessary documentation, adhere to loan repay-ment schedules.

Sadhav Mishra, partner, SNG & Partners, Advocates & Solicitors, says, “As per the RERA all the details of the project like approvals, title, commencement and completion date of the project is to be uploaded by the developer and hence a homebuyer is supposed to know all the details of the project before purchasing the flat. There is a stringent provision under RERA which states that if a homebuyer is delaying in making payments of the installment, then the developer shall have right to levy interest on the delayed payment with a right to cancel the allotment in case the payment is not made hence a homebuyer need to ensure that the payments are being made without any delay. There is a Latin maxim ‘caveat emptor’ which means buyer beware and hence in order to buy a property the homebuyer must carry out detailed title investigation of the property of the seller so as to avoid any future dispute/claim/litigation. As part of title investigation, it is strongly recommended that public notice must be issued especially for high valuer transactions as it mitigates the possibility of getting dragged in an undisclosed ongoing litigation/ dispute over the property. As a legal and regulatory compliance, the homebuyer needs to ensure that the flat purchase agreement is duly stamped and registered as it is a regulatory requirement under the provisions of Indian Registration Act, 1908.”

To sum up, buying a home involves substantial financial investments, and understanding the regulatory compliances associated with real estate transactions is crucial. Seek professional advice from legal and financial experts to navigate these compliances successfully and make an informed decision while purchasing your dream home. Remember, being well-informed is the key to a smooth and secure real estate transaction.