Home is what everyone plans to have at some point in their life. Are you too planning to buy a house or thinking of investing in the real estate sector? But the jargon of the real estate broker can be confusing and misleading. We know like every industry has its share of jargon and acronym, the real estate industry has it too. Not knowing the terminologies will make misleading you easier for unfair developers or builders when purchasing and buying a house. Although a reputed real estate builder will never misguide you to have a poor selection of property.
Let us review a few terms you should know before thinking of investing in a house.
The carpet area is the area you can use to move around, which means it includes the area within the walls. Under the RERA Act, the carpet area is specified so that builders cannot overcharge buyers for the built-up or super built-up area. Note-
Built-Up Area refers to the total area including internal and external walls thickness along with a balcony. For Example-If the built-up area of 1300 sq feet, the carpet area would be around 900- 1000 sq feet.
Super Built-up Area-
This area refers to the area of the home including the walls and balcony along with the common area. Common areas such stairs, lift terraces, gym, garden, clubhouse, and pool.
Floor Area Ratio is the ratio of floor space of the building to the total area of the plot of land given. The Floor Area Ratio is decided by the local municipal corporations. It can vary from one locality to another. Various factors are taken into accounts such as density of the population, available open space, the impact of the project on the environment, and resiliencies to a natural calamity than the FAR guidelines are issued.
It is a property where the owner has enjoys free ownership i.e. complete ownership of the house or commercial building/plot. Property can be inherited and there is no restriction on the owner to further transfer the property.
Conveyance is the act of transferring the title, ownership of property from one entity to another. A conveyance deed is a contract that is binding in the court of law, in which sellers transfers all the right to the legal owner.
Turnkey Property is a property that is near completion or recently renovated. This kind of property has high demand among investors. As minimal effort is required to put in a property and can easily be converted into a rental.
Agreement to Sale-
When a buyer and seller reach an understanding to enter an agreement on the sale of a property, they draft a document that defines the terms and conditions. Make sure you read each term and condition thoroughly.
Return on Investment-
ROI refers to the profit you reap from an investment. Return on investment tells you the profit you gain on an investment. Higher the ROI, higher the profits.
Cash Flow refers to the stream of cash which is coming in and out of a company. The difference between the cash flows will represent the positive or negative cash flow of the company. If the income is more than the money spent on it.
These are some important terms you must acknowledge before investing in any property. After all, this is a huge investment that anyone makes every once in a while. To keep yourself safe from any fraud, and to ease the process you can just go with any trustworthy Real Estate Group, such as Vision India Group in Kharar.