Hi.... I am going to buy resale flat 19 year old in pune, for which I have also applied to home loan. My concern is for clear title because previous 3 transaction done from builder to 1st buyer , from first to second owner, from second to third owner. The problem here is in all previous 3 sales only sale of agreements done & all were registered. But no sale deed executed. All previous 3 bank loan are closed by respective buyer.3rd owner have possession since 2004. Now it is very difficult to contact previous 2 owners for sale deed. Even 2nd owner and his wife are divorced and she is staying in United states. So it is near impossible to contact them.How to proceed since property is in prime location i am interested. 1) Should I buy it from third owner ,builder is ready to give NOC ,since no society is formed till date. 2) Whether I can do sale deed from builder and third owner directly without previous two owner. 3) does undivided share of land will be given to me without society formation.
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It seems like the flat is only transferred not sold in earlier instances.
The builder was only transferring the flat to respective owners. Please check if there is any registration of sale deed from the builder to buyer?
NOC from the builder will be fine if society is not formed.
1)agreement for sale precedes sale deed
2)The agreement specifies the procedures to be followed leading to the execution of the conveyance or sale deed. It records the understanding reached between the parties, and is binding on both.
3)it is necessary to peruse agreement for sale executed by the builder and other parties to advice. agreement for sale can operate as sale deed
4)Normally, ownership and title to the property will pass to the purchaser on registration of the sale deed with effect from the date of execution of the sale deed. But this is not an invariable rule, as the true test of passing of property is the intention of parties
5)contact a local lawyer and based on his advice take a call whether to purchase property or not
6) you would be entitled to undivided share of land as per terms of sale deed
1. Mere closure of loan is not enough to end the legal rights if past agreement holders.
2. Since they had registered sale agreement it has to be revoked by registered deed of cancellation only.
3. Unless and until its done don't even think of buying this property as you will never get a clean title and prospect of legal complications will always loom large.
In any apartment projects if your buying an apartment the undivided share in the land shall have to be conveyed to the purchaser.
You should get a Title Due Diligence from a local Lawyer to know about the title of the property.
If no sale deed is registered from the builder you should see weather the builder has the right/ownership over the apartment or not? - Preliminary title documents should have to be scrutinised.
To give any clarity on your issues it is must to scrutinise all the title documents.
First ask to the builder.can you exicut sale deed .If he says yes then go ahead
1. Sale agreement is only an agreement whereby and whereunder the seller agrees to sell the property to the buyer, whereas the title passes to the buyer only when the seller executes a registered sale deed in favour of the buyer. The title of first, second and third owners is defective. No seller can pass a title better than his own title.
2. Possession of the property does not make an imperfect title perfect.
3. The NOC from the builder will be of no legal consequence.
4. Either the builder has to execute the sale deed in your favour or he must execute the sale deed in favour of the first buyer and so on in a manner that the chain of title becomes perfect.
5. Consult a lawyer with the sale agreement to get a clear opinion.
Buying a new house requires a holistic approach, irrespective of whether you need a Home Loan or not. From choosing the right location and size to the right developer, there are a lot of factors that a buyer needs to address to get the perfect property.
Many buyers often decide on their purchase based on the built-up area offered and the additional amenities attached to the flat. However, the most important factor in any real estate purchase, which is the actual land that one will own, is often overlooked. This is more so in the case of apartments.
When you purchase an apartment, a certain value of the land will be allocated in your name. This is known as ‘undivided land share’. Let us take a look at this important aspect of real estate, its significance, and legal importance.
Understanding Undivided Share of Land (UDS)
When you buy an apartment, you are technically buying two things. The first component is the constructed part of the building where the owners will actually reside, while the second is a proportionate share of the land on which the property is built. The latter share of land allotted to the flat buyer is known as an undivided land share or UDS.
Significance of UDS
The building itself isn’t exactly a great investment because the value of the constructed area depreciates. The older the construction, the lower the market value of the property. On the other hand, the prices of land keep escalating over time and may offer substantial returns for the landowner.
This appreciation in the overall value of any property is due to the increase in the land rate and not the constructed area. Essentially, it is the undivided land share allotted in accordance with the built-up area of the apartment that determines the future monetary value of the property. In case the landowner has no undivided land share, he or she may not be able to sell the property or enjoy good returns on the investment.
Additional Reading: Home Loan Document Checklist
Legal Implications of UDS
The legal implication of undivided land share makes it an intrinsic part of any real estate deal. Suppose the building in which you reside is to be demolished for reconstruction ten years down the line or comes under a government acquisition project and made available for demolition, the compensation administered to the flat owner will depend on the percentage of the undivided land share in the property.
The sum of all the undivided shares for each apartment owner must be proportionate to the area of the land in which the apartment has been constructed. In case of co-operative housing societies, the UDS must legally be in the name of the society since the flat owners are the shareholders of the society.
UDS Calculation
UDS calculation is determined by a simple formula. It can be calculated by multiplying the total land area with the size of the individual apartment and dividing the result by the total area of all apartments in the project.
Illustration for UDS Calculation
Let us assume 5 equally sized apartments of 1,000 square feet are built on land that measures 3,500 square feet. The UDS can be calculated by multiplying the total land area with the size of the individual apartment (3,500*1,000) in this case and dividing the result by the sum of areas of all apartments which is 1,000*5= 5,000.
Hence UDS = 1,000*3,500/5,000 = 700 square feet.
Additional Reading: Avoid Real Estate Scams To Reap Rich Returns
UDS and Ownership of Parking Space
Some real estate builders and developers have been guilty in the past of selling open or stilt car parking areas to individual house owners. As per Indian law, an open car parking can only be sold as part of a common area and cannot be legally included as part of the floor area for individual apartments.
Checking Validity of UDS while Purchasing Property
While paying an advance for any property, make sure the builder or the seller provides you with the agreement copy. The agreement copy between the builder and the seller holds all the important details of the property in question including the details of the undivided share of land.
There is usually a dedicated section in the agreement that gives the details regarding the UDS share, which is often mentioned in either percentage terms (for example 0.75%) or in exact square feet terms. Make sure the agreement clearly mentions your undivided share in the land. The same figure should be mentioned in the title deed when the registration is done.
1. There has been no sale deed registered in favour of any body by the builder till to day.
2. Without registering sale deed by paying stamp duty and registration cost, title of a property does not get transferred to the buyer.
3. So, the property still stands in the name of the builder or in the name of the land owner who has entered in to a development agreement and executed a POA in favour of the builder to sell his share of the constructed flats.
4. You should buy the property from the builder by registering a sale deed wherein all the available parties who had registered agreements for sale (at least the last one) as consenting parties.
5. The above advise is subject to the condition that you have already conducted property and court search through a local Advocate and have obtained a due diligence report from him in connection with the said property.
6. If you buy the flat the proportionate share of the land will automatically be owned by you which is mentioned in the Sale Deed and it is independent of and unconnected with the formation of society or not.
1. You must buy the property from the vendor who has a proper and marketable title to the property.
Sale agreement is not a title document.
If there is no proper title to the property you should not venture into the purchase even if it may appear to be absolutely genuine.
2. It is incorrect and legally not valid.
Any such purchase would lead you to troubles in the future when you would try to sell it or even trying to get loan from bank.
3.
The member owner of the flat is entitled to UDS as other owner members.
