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What is the difference between RERA-registered, 'approved' and compliant projects?
Property

What is the difference between RERA-registered, 'approved' and compliant projects?

There are many developers who misrepresent facts in their sales and marketing campaigns by claiming that their projects are RERA approved even though they may not be compliant with the norms. Maharashtra Real Estate Regulatory Authority (MahaRERA) is now planning to take action against them.

 

MahaRERA said while such projects may be registered with the regulator and are marketed as such, they may not actually be RERA-compliant. Developers who registered their projects with the regulator but failed to submit documents that are mandatorily required to be filed quarterly, will face action for misrepresentation.

What did MahaRERA find out?


On checking the MahaRERA website, the officials found that while the developer has registered with the RERA, the mandatory quarterly details have not been updated for one or two years, and in some cases, even longer.

 

The MahaRERA official said. “We are going to start taking action against developers of such projects by issuing them notices and seeking clarifications on why action should not be taken. This must not continue and developers are expected to not misrepresent their projects by using the name of RERA.”

 

What is a ‘RERA approved’ project?

 

“There is no concept of a RERA-approved project and actually, it is a RERA-registered project.” Advocate Nilesh Gala, who practices with MahaRERA, said.

 

He said campaigns by some developers suggest that RERA has “approved” their projects so there is no impediment but that is a myth. Most developers do not comply with circulars and RERA guidelines but no action has been taken, Gala said.

 

 

How to check for RERA-registered and lapsed projects?
 

Potential home buyers can check the status of a real estate project through its RERA registration page on the official website of MahaRERA.

 

Registration of projects https://maharerait.mahaonline.gov.in/searchlist/search?MenuID=1069

List of lapsed projects https://maharera.mahaonline.gov.in/Site/1128/Lapsed-Projects

What is land tax and why you must pay land tax timely
Property

What is land tax and why you must pay land tax timely

Real estate essentially can be bought in two forms – either in a constructed form (independent house, floor, flat or apartment) or in a non-constructed form, which is mostly a piece of land. However, irrespective of the form in which a property is purchased, its ownership attracts government taxes. Mostly, this tax component is paid to the state government on annual basis. In this article we discuss in detail about the tax, an owner of a property needs to pay.

 

What is land tax?

In simple words, a mandatory charge paid by the owner for purchasing a property or plot of land to the local municipal corporation on annual basis. This tax is also referred to as the property tax. An important point to note here is that a vacant piece of land is exempted from taxation. However, a vacant house is not exempted from property tax. That is, once a building is constructed on the plot of land, the tax payment comes into effect.

Also Read: How to get your property valuation done to ascertain a correct market price

The land tax or property tax is a vital source of revenue for the municipal corporation. The tax amount collected is used by the municipal corporation for the following purpose:

  • Improving the local infrastructure including roads and parks
  • Maintaining the sewerage and drainage systems
  • Collecting the waste and garbage
  • Upkeeping the street light systems

The municipal corporation follows guidelines as laid by the respective law of the state for calculating the land tax amounts. However, the rate of tax and procedure of calculation may vary from one state to the another.

Some common factors that the municipal corporation takes into account for calculating the land tax are:

  • Location of the land parcel – urban, rural, semi-urban
  • Size of the land parcel – usually measured in square meters
  • Gender of the owner – male of female
  • Type of ownership – joint or single
  • Age of the owner – adult or senior citizen

Also Read: Stamp duty and registration charges are mandatory: Buyers should take utmost care on this front

An owner(s) of land or property may be complacent in paying the land tax correctly. However, if any discrepancy is detected by the assessor of a municipal corporation, they issue a demand or penalty notice to the owner. Regular default on land tax payments by the owner(s) may invite legal notices from the competent authorities. Hence, it is the responsibility of the owner and joint owner of the property to not only pay the land tax correctly and timely, but also to maintain the tax payment records (receipts) properly for future references.

 

What is the formula used for calculating the land tax?

For your simple understanding, the following formula can be used for calculating the property tax:

 

  • Property Tax = (Unit Area value per sq.mts.) X (Age Factor) X (Use Factor) X (Unit Area of Property) X (Structure Factor) X (Occupancy Factor) X (Rate of Tax)

 

Note: The above-mentioned formula is a general illustration. The rate of tax and formula may vary from one state or city to another. Thus, it is extremely important to take help of a qualified property tax consultant for getting a proper calculation done before filing the land tax.

Also Read: Can Homebuyers take Legal action against builder for delay in possession of Property?

 

In what modes land tax payment can be made?

The property owner can pay the tax in two modes:

  • Offline mode

In this mode, the owner needs to the visit the local office of the municipal corporation of their area with all the property details. The local municipal office provides a tax payment form that needs to be filled correctly by the owner of the property. The duly filled form needs to be submitted to the payment processing clerk or representative at the designated payment counter along with the payment amount via cheque or demand draft or cash. On receiving the form and payment instrument, the processing clerk issues a tax payment receipt to the owner/payer that is valid subject to clearance of the payment instrument.

 

  • Online mode

In today’s age, this is one of the most convenient modes of payment and the owner can follow the below mentioned steps:

    • Visit official website of municipal corporation of the city where property is located
    • Log in to your property tax account and go to the property tax page
    • On property tax page, carefully select the financial year for which payment of land tax needs to be made
    • Once the form opens, fill up the property details including the ownership details as mentioned on the form
    • Click on ‘generate property tax payment challan’
    • Once challan is generated successfully, website prompts the owner to proceed for making payment
    • Click on ‘proceed to making payment’ option and select the mode of online payment – usually done via credit card, debit card or internet banking
    • Make the online payment using your preferred mode and once payment is completed successfully, payment receipt is generated
    • Download the payment receipt on your computer and save it safely in your records for future references.

Also Read: Planning to transfer a property? Know the process and costs involved 

Why a property tax consultant is needed?

As explained in previous posts as well, a property tax consultant is a qualified expert who can help the owner in calculating the land or property tax correctly. The calculations are based on several factors as mentioned above. Not only this, the property tax consultant will also help the owner of property in filing the tax with local municipal corporation in compliance with the process. This eliminates or at least minimises the risk of unwanted property tax penalty notices being issued to the owner by competent government authority. Additionally, the property tax consultant will be able to guide the owner of property about available the tax rebates as applicable and amnesty scheme benefits, as the case may be. It is always a sane decision to file your property tax properly and saner to take professional help.

 

You can connect with a LegalKart verified property tax consultant and ask all land tax related question that you may have.

How to get your property valuation done to ascertain a correct market price
Property

How to get your property valuation done to ascertain a correct market price

Home or property buyers consider a wide range of parameters before they single out one house or property for purchase. Property selection parameters may vary from one individual to the other based on their choices and preferences. However, some of the most common parameters that a buyers consider may include:

  • location of property – rural, semi-urban, urban or metropolitan
  • size – carpet area, built-up area, super built-up area
  • number of bedrooms with bathrooms – 2, 3, 4 bedrooms with attach bathrooms
  • direction – park facing, pool facing, sun facing
  • type – flat, apartment, condominium, floor or independent house
  • legal status of colony in which property is located – authorised or unauthorised or laal dora
  • category – luxury or affordable or normal
  • floor – low rise or high-rise building
  • amenities – swimming pool, gyms or community hall
  • proximity to market, school or hospital
  • accessibility via public transport like metro rail, bus, auto (3-wheeler), manual or e-rickshaw
  • availability to home loans

Also ReadPlanning to transfer a property? Know the process and costs involved.

Depending upon the permutations and combinations of above-mentioned parameters, buyers generally are able to shortlist the most feasible options out of which they would generally zero down to one option for purchase. Ultimately, the mother of all factors – budget – also supersedes the choices we make and helps a buyer in pickup up one of the shortlisted options for buying.

 

While several factors are considered, the buyers are generally not bothered about the actual value of the property or house they want to buy. The biggest disadvantage of ignoring the valuation of a house or property mostly leads to buyer ending up paying a higher price to the seller. In this post, we share more details on the importance of correct property valuation, methods used and other related information that a buyer must know before making a property purchase decision.

 

What is property valuation and the process involved?

 

This is a scientific method of properly ascertaining the near-correct value of a house or property. There are specialised real-estate experts who conduct property valuations especially when a buyer plan to buy a property by taking a home loan.

 

As part of the property valuation process where a technical expert – a qualified architect usually called as the property surveyor – physically visits the property under consideration. During the site visit, the valuator takes measurements of all the rooms, bathrooms, toilets, kitchen, balconies, etc. using specialised technical measurement equipment. This process may also include creating a structural drawing of the property, counting the number of windows, doors, electrical points and plumbing points in the said property. The valuator also takes photographs of the entire property that acts as a proof of immovable property existence. Post taking the measurements on site, the valuator creates a detailed property valuation report mentioning the true value of the property.

 

The biggest benefit any buyer can reap from this process is that the buyer gets a fair idea of the near actual value of the property and he or she is in a better position to negotiate with the seller while closing the deal.

Also ReadStamp duty and registration charges are mandatory: Buyers should take utmost care on this front 

What are the factors on which valuation of a property depends?

There are several general factors on which the valuation of a house or property depends. They are:

  • Property size – generally represented in square feet or square meters
  • Floor plan – 3 bedrooms with 2 bathrooms or 4 bedrooms with 4 bathrooms
  • Alterations made – any extensions or improvements done
  • Condition of property – well maintained or poorly maintained
  • Age – New construction or old construction
  • Market situation – more supply and less demand or vice versa
  • Location – rural, semi-urban, urban or metropolitan

 

What are the methods used for property valuation?

 

Calculating a proper value of property is a complex task. It is in the best interest of the buyer and seller to take professional help of a qualified property valuation consultant for conducting the evaluation. The most commonly used property valuation methods are as follows:

 

  • Comparison method

In this method, evaluator compares the current market value of properties in a particular area and then creates the valuation report. Here the buyer buys a property for staying in it.

 

  • Profit method

This method is usually followed when a property is being purchased by a company. Here, the evaluator calculates the valuation based on income and expenses of the company.

 

  • Residual method

This method is followed when a buyer buys a property for investment purposes. Evaluator considers the possible profits that a property may yield in future.

 

  • Cost Method

In this method, evaluator considers the average cost of buying a land and building a property on it. The evaluator then uses this for comparison with existing properties in a particular area for arriving at the fair value of the property under consideration.

 

What is the role of a property valuator?

Also Read: Sale Deed Drafting: Take utmost care before registry 

The state law clearly defines the guidelines and methods for conducting a proper valuation of a property. It also mentions that a qualified property surveyor should conduct the valuation as per the process laid by law. Hence, it becomes advisable for a buyer to get the property surveyed and evaluated correctly. The government may view any miscalculation done by the buyer as an attempt to under value the property for evading government taxes, stamp duty and registration charges. Such under-valuations, once detected by the competent authority, may lead to unwanted and unpleasant legal hassles for the owner of the house or property.

 

Hence, it becomes all the more imperative to employ a competent surveyor or property valuator for conducting the valuation as per guidelines. In today’s times, more and more new age buyers are opting for such professional services that being are offered by property surveyors and consultants.

 

You can connect with a LegalKart verified property valuator to ask all questions that you may have.

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