A first time home buyer should scrutinize all the property and construction related documents before buying a house from any builder to avoid property related issues in future. As the real estate crimes increase every day, it is important for home buyers to check even if the project is launched by leading real estate construction firm. Most people check the Khata, sale deed, sanction agreement etc but do not concentrate on Joint development agreement which plays a crucial role if the project is a joint venture. A joint development agreement is an agreement between a land owner or owners and the builder/promoter regarding any real estate joint venture project.
The joint development agreement should include the names of all the owners of the particular land and the builder’s or the company’s name.
the agreement should also contain the expenses shared, effect of termination, alternative exit strategies and other legal provisions. This will help the purchasers have security even if there are issues in the construction or if either of the party wants to exit the agreement.
According to the legal process, the owner/owners of the land should grant a general power of attorney to the builder by signing the rights to his name.
The builder does not buy the property from the owner but only develop the property and share the profit. The builder only nominates the buyer and hence a separate agreement will be made between the buyer and the builder. According to this agreement, the builder fixes the cost of the property and amenities offered. The buyer is not involved in the possession of the property before the registration process.
So if you are a home buyer planning to buy an apartment or a residential property from a joint venture, it is necessary to check the Joint development agreement properly along with other document. Only after confirming the documents, book your dream home and have a trouble free home buying experience.