Investing In Gram Panchayat Properties? Know This
Buying a home within city limits is an expensive affair. Home buyers with modest budget are moving to the outskirts to find an affordable den. However, these outskirts and suburban areas are not always a part of city's municipal corporation. These areas are governed by Gram Panchayats. So how are these properties and real estate markets different from those which are covered under municipalities? Here's the explanation-
Why are Gram Panchayat properties popular?
Rajesh Sharma is a techie by profession and lives on rent in Pune. He had a stable job in Kharadi and wanted to own a house of his own in the nearby area. The property prices in nearby areas of Kharadi were touching Rs 7,000 per sq ft. However, one of the closest localities to Kharadi is Keshavnagar which has been notified to be merged in city limit, is still offering properties at a price range of Rs 4,500-5,000 per sq ft. Although, the merger is still pending but would be happening in near time and experts are speculating price rise in short time. This has resulted in launch of some of the premium projects in the area by reputed developers.
Buying a property in Gram Panchayat can be a good idea as the property prices here are comparatively lower than the nearest city area. Moreover, the potential of price growth is more as there is always a high chance that the area will get included with city limits in near future due to urbanisation and growing population in the area.
However, here is a checklist you must go through so as to make a sound investment in such an area:
Going for a peripheral area means you will be dealing with lack of purified water and at times power line failures. Many rural areas in the country still use groundwater or depend solely on wells for water consumption. Hence, the need of having water softening system at home becomes important. Before you buy the property, it is recommended that you run a water quality check to ensure that it is free of contaminants and dangerous chemicals. Also, know about the septic system to collect sewage and wastewater. It should have enough capacity to handle the occupants that will dwell in the property.
Rural areas, also, witness frequent power failures when compared to urban areas. Know the frequency of such failures in the locality you plan to invest in, especially during summers. Backup is what you will need. Check on how much does the property require.
All said and done, you don't want to live in isolation. Gram panchayat properties can be far from the main roads or highways. Know how well-connected the property is from the main road. Are the connecting roads well-constructed and smooth? If not constructed well, rains can destroy these roads. There could be a possibility that you would have to maintain a certain stretch close to your home. Be prepared for the expenses.
What is included in the deal
Know whom you are buying from and what is he selling. If the seller is an agriculturist with a full-fledged farming spread, is he selling something else besides the home such as livestock and machinery? Negotiate well, because in case you plan to indulge in farming yourself, you will have a whole setup in place.
Size of the property
Spread in a huge area, determining whether or not the property is of the exact size as mentioned by the seller can be difficult. Run an inspection on the size of the property and determine the boundaries. This will ensure that you are getting what you are paying for and also, will be beneficial for you if taking a loan.
Cost of ownership
This is what you will be spending on the property to make it livable. Not just the price of the property, cost ownership has more to it. This would include your regular utility bills, repair works if any, fencing and taking care of the livestock, the farm, machinery etc. Maintaining a widespread property can cost you more than you thought. Be prepared to keep a budget for the monthly maintenance of the property.
Also keep in mind the following
- You might need to compromise on your surroundings as the infrastructure provided by Gram Panchayat is of poor quality.
- The neighbourhood mainly comprises of local inhabitants hence the cosmopolitan touch of an urban landscape will be missing. But as the area develops, the gentry might change.
- Builder prefers to buy a plot in Gram Panchayat area as the tax liability is less. Before investing, make sure that land title is clear and you have done the due diligence.
- Do not fall for false promises of your developer, enquire at the Gram Panchayat office about the merger notification if any or about the upcoming infrastructure expected to hit the market.
With inputs from Gunjan Piplani