Home buying is a process fraught with risks of errors big and small. Additionally, for first-time home buyers, it can seem like navigating through a foreign country with an unknown language. It is wise for newbie home seekers to do some initial research before starting off. One specific aspect you should include in the initial research is what commonly used real estate terminology means.
Here are some terms that you need to know when hunting for your dream property:
Commencement certificate
A commencement certificate is a document of approval that has to be obtained from local authorities before construction is started. Commencement certificates are mandatory for apartment complexes. If you are considering purchasing an apartment at a pre-launch or under construction phase, ensure that you are shown the commencement certificate before signing agreements.
Common areas
Those portions of a building, land and amenities owned by an apartment complex’s homeowners’ association that are used by all of the unit owners and share in the common expenses of their maintenance. Common areas could include facilities such as swimming pools, tennis court and gyms, as well as common corridors of buildings and parking areas.
Encumbrance certificate
An encumbrance certificate is documentary evidence that a particular plot of land is free from any kind of legal or monetary liability. The certificate is normally issued by registrar of assurances or sub-registrar’s office after due verification of the relevant documents.
Freehold property
A freehold property provides its owner with absolute control over the land as well as the constructions on it. Freehold property owners can transfer, sell, mortgage or lease the property. Record of ownership of the freehold property can be found from the office of the sub-registrar. It can be transferred through registration of sale deed.
Stamp duty
The government collects tax on property transactions within its jurisdiction in the form of stamp duty. Transactions may include agricultural or non-agricultural land, independent houses, commercial units or flats. The stamp duty is to be paid by the buyer.
When purchasing property, the more equipped you are with information, the more sound your investment is likely to be.
