Are You Making Safe Real Estate Investments?
Over the years, real estate, worldwide, has attracted major investments. People looking for their first abode, a retirement home, a wedding gift for their children, an extra living space, or an opportunity rendering high investment and rental yields, have seen themselves investing in brick and mortar. While many have invested in the sector, not all have benefitted from the high returns and some unfortunate souls have also seen their investments diminish completely. With this particular excerpt, we wish to leave you with a few factors that will help you gauge the viability of your real estate investments.
True fruit bearing investments are mostly complemented by the element of credibility. Credibility can further be translated into three major part
Land Ownership or Entitlement
Land ownership, entitlement or possession stands as the very first pre-requisite for the initiation of any real estate project.Unfortunately, in the case of Pakistan, due to de-regulated zones, many real estate developers end up initiating projects and sales without having clear ownership and possession of the land. Such acts have left the end customers investing into nothing but sheer “dream lands”. The investments render mere paperwork that entitles the customer to nothing but thin air.
It is fairly simple for a customer to determine whether or not a real estate developer has ownership of the land. It is advised to probe around the subjects of a transfer of ownership or a title deed and the NOC issued by the relevant authorities. While we will discuss NOCs in the next section, it is essential to know whether your investment allows a transfer of title deed from one entity to another. Any real estate developer that does not have ownership of the land will fail to transfer the title deed from their name to the customer’s. Such a transfer can only be carried out through the relevant government authorities and does not come in the form of a letter issued by the developer on their organisation’s letter head.
Authorisation by the Government
An authorisation by the government or the relevant authorities can be seen in the form of a No Objection Certificate, better known as an NOC. The NOC will only be issued to the developer on the basis of clear ownership of land and the approval of planning documents submitted to the authorities. The NOC specifically states the area allotted to the project whereas the planning documents highlight the zoning regulations, the building codes and other relevant by-laws.
Customers retain every right to ask real estate developers for proof of NOCs or approvals of the project by relevant government authorities. In many cases, information pertaining to issued or revoked NOCs can also be obtained online. Without a valid NOC, it is illegal for the developer to sell, develop or provide possession against the project.