In most residential projects, the developer does not own the land on which the construction is taking place. There are pre-signed contracts between the developer and the landowner regarding the shareholding in the projects where they both individually enjoy the price setting in most cases. Whether it is apartment or villa projects, both developer and landowner invest with a great deal of commitment and enthusiasm.
The flat or villa buyer has the right to decide from whom they can buy. While buyers have a general idea about buying from the developer, have very less idea about buying the Landowner’s share of flats. We have put together an article to guide you through these properties.
Get better prices and deals in Landowner share of the project
Every asset owner aspires to get the best price in every sale. But, when working with developers, landowners have very little input costs. They are not as business-centric as the developer. The first thing on their mind is to offload their share of units for value realization. The approach with the landowner is often friendly and personal, unlike developers where things are straight and professional.
Whether it’s an apartment or a villa, buyers can strike a rapport with the landowner and the conversation can be warm and personal. A buyer can negotiate easily and could bring in more referrals to get additional concessions. Very often, the buyers develop a bond with the selling entity. There is always a possibility to get more competitive rates for available units.
The units are better in quality and position
The Landlord’s share of units appears to be a better option in many cases as they have ownership over better units such as easy facing, corner units, corner Property, etc. Even in terms of Vastu, these units are better. Their share of units comes with floor choice, apartment view, and many more design benefits.
Better Construction Quality and Interior Design
In any residential project, apartment or villa, there is a site engineer hired to supervise the project, irrespective of whether they are landowner’s share or developer’s share. However, in the case of landowner’s units of flats or villas, the concerned party will also take a personal interest in supervising the construction and look into all the necessary details related to raw material quality, design functionality, and other aspects. This results in better quality for the landowner’s share of the units in a project.
Already Customized Interiors
Landowners may sometimes reside in their share of property or rent them out before deciding to sell. In such cases, a lot of interior customization with respect to plug points, switchboards, fittings, shelves, etc. might have been done already. This is an added advantage to the buyer from Landowner.
Better aesthetics and Efficient space allocation
Most often landowners take a personal interest in their allocated share of units with a sense of love. The look of the units might be better and more beautiful compared to the developer’s share..
Save GST and EMIs before possession
Landowners’ share of units in a project is available only for sale after completion of the Project. Unlike developers who sell property in the construction stage only. In such a case, the buyer has to keep on paying EMIs without possession of the unit till the Occupancy Certificate is obtained from the regional RERA (Real Estate Regulatory Authority). This will help save GST and Pre EMIs as well.
Buying from an under-construction project would mean looking after existing liabilities like rent or lease and adding additional liability with EMIs if the purchase is funded from Home Loans.
Landowners’ share of units may be a distress sale
Unlike developers, landowners don’t spend on marketing or pay referral commissions to find potential buyers. For a wide variety of reasons, they are in a hurry to sell their units. As may be the reason, they might let go for a lower price if the transaction could be fast-tracked.
Summarising, there are multiple benefits to buying a landowner’s share of units in a property. To conclude, you may get better quality, better-looking apartments at a competitive or even a lower price compared to the builder’s share of the property if you are lucky.
Here’s a catch!
When it comes to issues like a landowner’s share having a lot of legal heirs and a lot of shareholders – like children and grandchildren, it is important to note that the same issues can also apply to the builder’s share of units. That’s because ultimately the whole property including the builder’s share belongs to the landowner.
In certain cases, the developer does not include all the legal heirs or stakeholders of landowners in the Joint Development agreement between them. As such, any risk arising from legal heirs is equal for both landowner’s share of apartments and villas, as well as the builder’s share.