What You Need To Know About Maintenance Charges..
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Jay Kalghatgi
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By Mr. Kishor Pate, Amit Enterprises
Housing Ltd.
While buying a house in India, stamp duty & registration
charges are the most significant additional costs above the base price of the
property itself.
Close on the heels of this expense come the costs involved in
registering with the local electricity board and having a meter fitted.
Cost of Insurance to Home loan..!
Yet another burden which house buyers do not always factor in is
the cost of insurance to cover the home loan.
Of course, all this is in addition to the brokerage payable to
the property agent, for which the industry standard is 2 per cent of the base price (but can often be
negotiated).
If we take 5 per cent as payable towards toward stamp duty and
another 5% to 7% for the other initial charges, the added expenses incurred at
the actual time of house purchase can come to as much as 10% to 12% of the base
price of the flat or /the amount availed for via a housing loan.
However, these are one-time expenses and do not imply a
recurring financial burden on the home buyer once they are cleared.
Two recurring expenses that a property owner will face are the
annual property tax & the maintenance charges. While the property tax is
predictable, maintenance charges are a different matter altogether.
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| Mr. Kishor Pate, Amit Enterprises Housing |
Recurring
Maintenance Charges..!
This is an area where the quality of construction plays a big
role. Many home buyers in cities such as Mumbai and Pune are drawn to the lower
property prices of projects by small-time developers, only to regret it later
on. Such developers often use inferior construction materials which do not
stand the test of time.
The first step towards ensuring that one is not burdened by huge
maintenance costs in the future is obviously to buy homes in projects from
established builers / developers with a reputation for quality construction.
Another good reason for buying properties from reputed
developers is that many of them provide very reliable and accountable
maintenance services via qualified external agencies.
Nevertheless, existing home owners who have not taken this
primary precaution are not completely helpless.
Preventing Escalating
Maintenance Charges..!
Flat owners must ensure that the annual maintenance charges are
used optimally by the housing society. A majority of housing society offices
have a separate fund for maintenance towards which all property owners
contribute.
However, the onus of responsibility on flat owners does not end
with merely paying these charges. They must ensure that proper preventive
maintenance is actually undertaken and that maintenance funds are used for the
specified purpose only.
Especially in the case of older buildings, another important
step towards preventing huge maintenance charges is to identify the most
problem-prone areas within a particular apartment building.
To do this, the flat owners should order an inspection of the
premises by a qualified agency. The problem areas must be identified, and
appropriate remedies must be established.
In many cases, property maintenance undertaken by the housing
society’s administrative body is symptomatic. In other words, problems are
tackled only as and when they arise.
If the flat owners in the building feel that the housing society
is not sincere in its efforts and that property maintenance will become a major
issue, they must take appropriate action.
The best course of action is to pass a resolution that the
maintenance of the premises be entrusted to a professional agency under an
annual contract. This will ensure that money meant for the purpose of building
upkeep is accounted for, and is being utilized for its intended purposes.
It must be remembered that recurring property maintenance
expenses can be quite heavy if the building or project is not well looked
after. This also reflects in future resale value of a flat, which is why units
in older projects which have not been maintained well do not fetch the expected
prices.
About The Author:
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Mr. Kishor Pate,
Amit Enterprises Housing |
Mr. Kishor Pate, Chairman & Managing Director of Amit
Enterprises Housing Limited (AEHL), is the driving force behind one of the
country’s most successful real estate development firms in Pune and beyond.
Apart from its signature luxury homes towers and premium gated townships, AEHL
has also launched highly successful affordable housing projects like Astonia
Classic in Undri and Astonia Royale in Ambegaon.
For Media Contact
Jay Kalghatgi
Client Interface - CopyConnect
Mobile: 9320142248
