Everyone dreams of building a house, especially if it is feasible in a preferred location. However, the first part of the process begins with purchasing land. Here are some things that will help you throughout the process.
Owning and building your home is a dream that is not always fulfilled owing to the scarcity of land or plots in major cities and surrounding areas. However, if you find a suitable plot for construction your home in a preferred area (and within your budget), then you should keep a few things in mind.
Summarizing The Core Watch-Outs
| Land Title | Searching Process | Other Aspects |
| • The biggest and most important document is the land title. • Check whether the plot has a clear title free from disputes and whether it is marketable or not. • Confirm the identity of the plot owner and whether he/she has rights for transferring ownership to the buyer. |
• You can consult your lawyer for getting the title search done along with getting him/her to examine the property tax receipts and sale deed. • Tracing the land title for the last three decades (30 years) is usually recommended. • You can undertake searching at the office of the sub-registrar. You can trace ownership changes and the chain of transactions. |
• Before buying the plot, you should ideally put a notice in the newspapers through your lawyer or yourself. • This notice will state that you are purchasing the property and will seek any claims over the land to be submitted within a requisite period. • This will help you find out about any existing third-party rights or claims over the plot in question. |
Some Other Core Points to Keep in Mind
- People sometimes purchase or sell land via their POA (power of attorney). If this is present in case of the land parcel, then it should be closely analyzed for verification purposes.
- You can also authorize an individual to sign on your behalf through this POA if you are buying the land. If the seller has given the POA to someone else, then all checks should be conducted before moving ahead with the transaction.
- You should ensure that the land is not mortgaged or the loan taken to buy it has been cleared or paid off by the seller/owner.
- You should verify all the documents including the Government documents, approvals, NOCs and other permissions. Other regulations including road width and permitted development rules should be examined carefully as well.
- Check whether the property taxes have been paid in a timely manner till the date of the ownership transfer and the original receipts for the same. The Khata should be in the vendor’s name as well.
- Check all local and municipal/Panchayat regulations for buying land in a particular area along with the development regulations.
- If the land is under a lease with a specific tenure, then you should avoid the purchase or check for the lease renewal conditions. There are sometimes provisions to attain ownership by paying an additional rental amount.
- The land should be measured before registration. You should take help from a surveyor for this purpose.
- FSI or floor space index is what determines the construction that is possible on any particular plot. It is worked out by the State Government’s requisite planning development, dependent upon the plot size. Check the allowable floor space index for the plot.
Loans and Other Aspects
- You can take a loan for buying a land parcel or plot.
- However, you can get a maximum amount up to 60-70% of the plot value in most cases with smaller tenures of 10-15 years in most cases.
- You can get tax deductions under Sections 80C and 24 for home construction.
- Get the encumbrance certificate from the sub-registrar’s office if possible.
- The release certificate is also essential while purchasing a resale plot of land. This ensures that all pending loans have been cleared by the seller.
- Get the Government’s NA (non-agricultural) land order as well.
- There are stamp duty and registration charges payable at the time of transferring ownership. Make sure that you factor these costs into the purchase.
You should make sure that you conduct the above-mentioned checks before finalizing your land deal. Also ensure that you are buying a plot in a location with sufficient road-width and also other basic amenities. Check whether any major projects are planned for the area (entailing land acquisition by the Government) or whether any zone has already been allotted for any infrastructure or other project by the authorities. Make sure that there are major roads and public transportation facilities nearby as well. Buying a plot is a long process; stay patient and do not be in a rush.
