Home Buyer's Checklist

April 2019

Searching for a home buying checklist online can be annoying because so many of those websites are not written by veteran agents with decades of experience. They are often just a compilation of ideas put together by a writer or journalist. Not real world and not always practical. Below is a home buying checklist put together by a full-time real estate professional.

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Find a Real Estate Agent

First and foremost, a good real estate agent can answer all of your questions and point you in the right direction. Even if you are not ready to buy for a while, an agent's advice will be invaluable. Avoid early disappointment. You cannot begin the process of determining a sales price until you get prequalified, nor look at homes until you know how much home you can buy, all of which an agent can assist. Here are some tips to get you started: 

Most buyers work with the first agent they run into or a close family friend. You can find an experienced professional who will listen to you, conduct herself ethically, and knows your market well through referrals, open houses and other recommendations. 

Study the rules for working with a real estate agent to make sure the entire process moves smoothly for you.

​Talk to a Mortgage Lender

Lenders come in all types. Some make only certain types of loans. Others have a broader ability to match a loan to specific needs. Don't automatically assume that the place where you maintain a checking account is the best place to get a loan. Ask your real estate agent for a referral. Agents know which lenders perform and which do not. This checklist will help you find the best loan: 

Get a free credit report from the only reputable place online to obtain such a report. Don't bother paying to get a FICO score because your lender will use a different service. 

Just because you like a lender's website is no reason to get a loan from that lender. First study the various places to get a mortgage loan.

There are many types of mortgage loans, make sure you choose the mortgage best for you. Ask your agent how easy it is to get some of these financing contingencies accepted by a seller.

Get Your Finances in Order

Once you have determined your down payment amount, set the funds aside and do not alter your financial situation. Lenders will track all monies coming into your checking and savings accounts, and large unexplained sums or monies from unusual sources could cause difficulties. Ideally, you want the money in your account for two to three months, which is called "seasoning." Make sure you: 

Get a preapproval letter. There is a difference between being pre-approved and pre-qualified, and pre-approval is better.

Do not make any large purchases on credit or by diluting your cash reserves. Learn what can go wrong in underwriting that could cause your loan to be rejected.

Study the top three loan approval mistakes made by home buyers. Presenting the wrong type of preapproval letter could affect your chances of offer acceptance.

Find the Perfect Home

The best thing about home shopping after following this home buying checklist is the fact you have covered all of your bases up front. You know you are prequalified to buy a home. You know you have the funds available to purchase. And you know you have hired the right real estate agent to help you successfully navigate the journey of home ownership. These steps will help you reach your goals: 

Once you have selected a neighborhood, you need to find a home to buy that meets your price range and fulfills your desires. 

Even though your agent is sending you listings every day, some buyers cannot resist the do-it-yourself approach and want to find the best places to find homes for sale online. 

Rarely will a foreclosure be your best option but that doesn't stop buyers from wanting to find foreclosures and government-seized homes.

Make a Purchase Offer

Little is worse than writing offer after offer and none accepted. It can dampen your spirits and make you start to wrongly believe that you do not deserve to buy a home. Start by listening to your agent's advice. Don't be that buyer who thinks she knows best or you may become that buyer who needs to learn the lessons of rejection. Follow these tips to catch the eye of the seller: 

When you find the perfect home, you need to make a purchase offer immediately. Many buyers are looking at the same homes who have similar desires and tastes. If you encounter a multiple-offer situation, make your offer shine above all the rest by seeking out expert advice from your real estate agent. Some lucky buyer will win, and that buyer could very well be you.

Study the market comparables and your present type of real estate market, which changes all the time. Then learn how to make an offer to buy a home that will blow the seller away.

​Close on Your New Home

Once your offer is accepted, you will enter the process of closing on your new home. Part of the home closing process involves due diligence on the part of the buyer. Talk with your agent about types of inspections you might want to order and the timeframe for your contingencies. These steps will help you close:

First order of business is to obtain a home inspection for your own edification. Use this handy home inspection checklist to make sure you examine the essentials. Set aside funds for your home buyer's closing costs. It is money in addition to the balance of your down payment.

You may pay upfront for an appraisal from your lender. Here is the entire home closing process, and the types of mistakes that can cause delays.​

Also read: How To Get A Home Loan To Construct Your Own House

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Agreement for sale or final payment: What constitutes a transfer of property?

April 2019

When there is a delay between the date of registration and the full execution of an agreement to sell a property, when is the transfer said to be complete? We examine a Bombay HC decision and the implications for property owners

For the sale of an immovable property, generally two types of agreements are made – an agreement for sale and a sale deed or sale agreement. The agreement for sale is required to be stamped and registered, as per the law of registration. There may be a delay between the date of registration and execution of the agreement. It is generally believed that on registration of an agreement, the rights in the property always get transferred from the vendor to the purchaser. However, this perception is not always right. The Bombay High Court recently had an occasion to deal with this question, in the case of The Principal Commissioner of Income Tax-25 Vs M/s Talwalkars Fitness Club, which was decided on October 29, 2018.

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Agreement for sale versus final payment: Decision of the Income Tax Tribunal

M/s Talwalkars fitness club had agreed to sell a flat for Rs 2.2 crores and had received an advance of Rs 20 lakhs against the deal. The agreement to sell was executed on February 14, 2011 and was duly registered. The agreement had a clause to the effect that the sale/transfer would take effect, on the full consideration of Rs 2.2 crores being paid. As per the terms of payment in the agreement, the final payment was to be made by May 26, 2011, i.e., in the next financial year. As per the terms of the agreement, the possession of the property was also to be handed over on full payment of the sale consideration. The vendor was also required to pay for the maintenance charges and other charges, till the possession was handed over. As the date of agreement and the date of final payment/possession fell in two different financial years, a dispute arose between the tax authorities and the tax payer, as to the year in which the profit on sale of this property would become taxable. The Income Tax Department treated the date of registration of the property, as the date on which the transfer took place and had, accordingly, taxed the capital gains in the assessment year 2011-2012. The dispute went to the Income Tax Tribunal.

On reading the agreement in its entirety, the Income Tax Tribunal came to the conclusion that the sale or transfer was not complete on the date of execution of the agreement and that the transfer of the property took place, when the balance payment was made and possession handed over to the buyer, which happened during the financial year 2011-2012. Hence, the capital gains were taxable in the assessment year 2012-2013 and not in the assessment year 2011-2012, as was done by the assessing officer erroneously. The tribunal also observed that the agreement which was registered, was an agreement to sell and not a sale agreement.

Decision of the Bombay High Court

The Bombay High Court, while deciding the case on October 29, 2018, held that the conclusion arrived at by the Income Tax Tribunal was correct and the sale/transfer of the property in question, was complete only during the financial year 2011-2012. The court also observed that the tribunal was right in its conclusion that on facts, the agreement executed on February 14, 2011, was an agreement for sale of immovable property. The law then prevailing, required such an agreement to be registered. In any event, merely because it is registered, it does not partake the character of a conveyance or a sale deed automatically.

Implications of the Bombay HC decision, on capital gains computation and income tax

The decision of the Bombay HC has wider implications for taxation of capital gains on sale of properties. With respect to the year in which the profits from the sale of a particular property will become taxable, this decision will have no impact as long as the date of registration and date of final transfer fall in the same financial year. However, it may have implications for determining the period for which a particular asset has been held by the seller, on the date of sale/transfer. It will be the date on which all the conditions, as enumerated in the agreement for sale, are complied with. Presently, for qualifying an immovable property as long-term capital asset, profits whereof are eligible for exemptions and concessional rate of tax, the date of transfer as intended on the basis of the agreement, will have to be taken into account.

Likewise, there are provisions in the law, where an assessee is required to invest in another residential property within a particular period. For example, under Section 54 and 54F, an assessee can claim exemption from long-term capital gains, if he buys a residential house within one year before and two years after the date of sale of such long-term asset. He can also construct a house or book a house within three years, for availing of the above exemption. So, for computing the period of one year, two years and three years, the actual date on which the assessee became the owner of the property will be relevant, to decide whether he has complied with the conditions within the time prescribed.

Likewise, a tax payer is required to hold the residential house, purchased with a home loan, for a minimum period of five years, failing which the tax benefits availed of under Section 80 C, for repayment of principal amount of the home loan, are reversed in the year in which the house is transferred. Here also the actual date of transfer will be taken into account and not the date of execution/registration of the agreement.

It may be noted that merely because the full consideration is not received, the agreement will not result into transfer of the ownership. There may be various other terms and conditions, which may be imposed on buyer and seller, to make the sale complete. In case the vendor agrees to treat the sale consideration, partly or fully, as loan to the buyer and where no other conditions are needed to be complied with further, the date of agreement and registration will be taken as the date of transfer and other consequences will follow.

Also read: How To Get A Home Loan To Construct Your Own House

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Dos and don’ts for buying a property to earn rental income

April 2019

An investor, who is looking to buy a property and lease it out, should approach the process with a lot of forethought, to get optimal returns and avoid a serious financial setback from a wrongly-chosen property. Here’s what you should consider, when looking for an income-generating property

From the initial choice, to finalising the purchase of your first rental property as an investment, there’s plenty of planning and work involved. You should begin hunting for your rental investment property with an unbiased approach, to the areas and all of the properties in your investing range.

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Let us have a look at the foremost things that you need to consider, when trying to find the best rental property.

Area

The quality of the location in which you purchase a rental property, will determine the kind of renters you will find and how frequently you may face vacancies. For instance, in case you purchase the home in an area near a university, the odds are that your pool of expected renters will largely consist of students. You may be faced with frequent vacancies, during the time when students return home for the holidays. Also, there would be a higher churn of tenants, when, ideally you should look for long-term leases.

Examine the location and the project, for existing and planned public parks, shopping malls, gymnasiums, cineplexes, public transportation and all the other factors that would conceivably entice tenants. You can use developers’ project brochures and also do online research, to determine the availability of such facilities in a neighbourhood.

You also need to know what new developments are coming up and what has been zoned for special purposes by the local municipality. Ideally, you should look for a region with excellent growth prospects, where schools, business parks, shopping malls and entertainment zones are either already in place or planned.

Simultaneously, be wary of any new developments that could reduce the value of the surrounding properties, such as by causing the loss of green open spaces or public parking facilities.

Property taxes

Property taxes aren’t standard across the board and as an investor intending to earn money from rent, you should know about how much you will have to shell out, as taxes.

High property taxes are obviously justified in very good areas, which are superlatively connected. Such areas also usually attract long-term renters. Locations in upcoming growth corridors should be preferred.

Educational institutes

Your tenants may be a family with kids, or intending to have kids, who would prefer areas which are near to one or more good schools. The presence of quality schools in the area you invest in, will positively impact the worth of your investment. Remember, the total worth of your rental property comes into play, when you finally sell it, even though you’ll be mainly concerned with earning monthly rentals in the interim.

Job market

Areas with growing employment opportunities have a tendency to draw more people – meaning more renters. Obviously, the most desirable situation for you, would be to own a rental property near to or well-connected to an established or rapidly-growing workplace hub, with reputable companies active and generating jobs there.

Project quality

Today, rental home seekers prefer projects, which add value to their lifestyle. Good projects with the best lifestyle deliverables, may be out of their purchasing reach, but they expect to get such facilities in a rental home. Projects with amenities like gardens, children’s play area, sitting area for elders, reliable security and professionally managed maintenance, are always preferred by families hunting for rental flats. The ambience inside the complex is very important to them.

Rental amount

You should be aware of what the typical rent in the region is. Make sure you find out enough about the region, to judge where it is headed in the following five years. Property taxes may rise and even if you can afford them now, significant developments in the area which increase property taxes, may make them less affordable.

Single-family homes often bring renters looking for long-term leases. A dual-income family is preferable over single professionals, as they are likely to pay their rent on time and to be fiscally stable. Hence, as a landlord, look for areas, where it is easy to find such tenants and where such properties are available.

When you’ve narrowed down the right location, look for a property that can potentially yield steady and growing rental income, as well as appreciation on the capital value of the home. Consider properties which are within your budget and slightly above it, as well. The slightly costlier options can be paid for by some bank leveraging and developers may be open to negotiating the price.

Also, remember that a property can become even more desirable, with some modifications and cosmetic changes, which will attract tenants who are willing to pay higher rents. Such changes to the property will also serve the purpose of increasing the sale value of the home, in case you want to put it on the market after some years of good rental income.

Every state and every city has areas, which have suitable and excellent properties when it comes to rental potential. In Pune, areas like Undri, Kothrud and Ambegaon, are excellent locations for rental properties, because of the consistently high demand. In Mumbai, the more cost-effective locations in Navi Mumbai, such as Koparkhairane, Airoli and Ulwe, are very good options, although property prices are naturally higher there.

Do your research well and ensure that you have your finances in place, if and when a very good option comes up. Remember, real estate investing does not begin with purchasing a rental property – it starts with creating the finances where you can purchase a rental property.

Also read: Which is more attractive: Rental income from residential or commercial property?

TO KNOW MORE ABOUT PROPERTIES IN THANE FOR SECOND INCOME VISIT REAL ESTATE THANE CREDAI MCHI THANE UNIT

9 natural DIY tips to cool your home this summer

April 2019

Electricity-guzzling air-conditioners and coolers, are not the only ways to beat the summer heat. Try these natural, do-it-yourself tricks instead

“ACs and coolers are fine, but nothing evokes my memories of childhood summers like a ‘khus ki tatti’,” says Gurugram-based businessman, Avinash Arora. Confused? Arora spent his summer vacations in a little town named Tundla in UP. North Indian summers are infamous for their intense heat, which can even prove fatal. Very few things can help you survive such weather and a ‘khus ki tatti’ is one of them, the businessman maintains.

A ‘khus ki tatti’ is a wholly natural blind/ curtain mat that is made of reeds and special grass, laid out neatly in a box and complete with water pipes for drip wetting. This mat is laid across open doorways and windows and helps lower the temperature indoors.

Credits : freepik.com

Here are several other simple methods to cool your home:

1. A simple trick involves using a bucket of water.

Dip the bottom hems of your curtains into the bucket and leave the fan on. The water slowly seeps upwards through the fabric and the breeze will carry the coolness into the room

2. Keep things dark.

We all know how relaxing it is, to get away from the glare of a hot summer sun and into a cool space, under the shade. To achieve this, buy cotton curtains in the darkest colour possible. Ensure that the curtains have a thick lining, so that the sunlight doesn’t fade them. Dark green or brown are easy choices. Keep the curtains drawn shut, right from morning. If your room stays shielded from sunlight all day, it is bound to remain relatively cooler.

3. Use the bathroom.

Keep your bathroom door ajar, pour a few litres of water on the floor and let the breeze do its job again

4. Leafy plants, too, can work wonders.

If you have some large decorative or potted plants around, move them closer to your windows. They will absorb most of the heat and create a cooling effect around them

5. Leave the fridge alone.

You may be tempted to reach for cold water and ice-cubes frequently, but opening and shutting the refrigerator multiple times, increases the load and temperature on its motor. This, in turn, increases the ambient temperature in your house

6. Take a look at lighting.

From LEDs to fluorescent lights, there are many cool lighting options available, so there’s no reason to continue using hot incandescent bulbs. Similarly, switch off all electrical appliances, especially the TV, when not in use. Even a mobile charger emits heat

7. Buy a dehumidifier.

You will breathe much easier, once the intense humidity is reduced. You can check online sites for the best deals

8. Cotton is king.

Summer is no time for fancy satin or silk bedsheets, or for faux leather upholstery. Buy at least one set of crisp cotton bedsheets, in white or pastel shades. If your couch is upholstered in any fabric that’s not cotton or linen, buy some sofa covers or throws that are made of cotton

9. Open up at sunset.

If you throw open your windows at the right time, you will get the benefit of the cool evening breeze. This will lower the temperature of your home and make it more comfortable for the night ahead. Also, open up every internal door in your house, including kitchen cabinets and bathroom, bedroom and closet doors. This will help, to dissipate the heat that is built up during the course of the day and reduce the overall temperature. Remember to close these doors as soon as the next day dawns and the sun is up again.

Also read: Tips for renovating a bachelor’s house into a couple’s home

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Source: housing.com

 

How to design a healthy and ergonomic office for yourself

April 2019

Planning to work from home? Here are some ways in which you can plan an ergonomic office for yourself

It is very important to have an office designed in a way that helps the employees to be productive. Even if you are converting your house into an office space for yourself, you must make proper arrangements so as to enhance your productivity and avoid falling ill or developing backache, etc. Here we look at some of the simple office design tricks that can be adopted to make the office more productive:

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Lighting in the office

When you are designing a healthy office for yourself, it is of paramount importance to get the lighting aspect right. There should be as much natural light as possible for you to be productive. Poor lighting can lead you to be tired and sometimes irritable also, which will pull down your efficiency and productivity. Poor light can also result in eye strain, drying up of the eyes and sometimes a headache. While allowing maximum natural light for yourself, you also have to see how the glare of that lighting is on the computer monitor. Too much glare can also be harmful and will result in eye strain. The angle of the computer monitor can be adjusted so as to avoid glare. Soothing light can make you really comfortable and increase your productivity.

Furniture in the office

Having the right furniture is also of utmost importance. Poor quality furniture or furniture that is ergonomically not right can really drain you out. The desk has to be of the right height and has to support your body parts like arms and wrist properly. Ideally, the height of the desk should be 86 cms or 34 inches.

There are several physical disorders associated with not having the right posture. Problems like muscle strains, carpal tunnel syndrome and backache, are the commonest problems due to not having the right posture for long hours. These wrong postures can sometimes be due to your own sitting habits and sometimes due to the wrong furniture. You have to be really careful about the chair and its height also. There are very efficient and ergonomically designed chairs these days that you can buy for yourself. The chair should offer height adjustment and must have good back support, especially lumbar area support. These chairs may cost a bit but the cost is recovered soon owing to increased productivity.

Silence

How much noise you have in your office has a bearing on your performance and productivity. It’s best to cut out any unwanted noise and have a lesser level of silence in your office. Nowadays, there are sound absorbers available in the market which can soak up unwanted noise from outside. Another trick is to run a background noise yourself so as to be able to distract yourself from the original source of noise. If you do choose the background noise option, then go for natural sounds as they are more likely to improve your concentration.

Going green

Going green is another effective way of improving productivity at your workplace. Not only will the plants in your office generate more oxygen which is desirable but there will also be a soothing effect on your eyes which will take part of your stress away.

Also read: Tips For Office Designing To Improve Employee Productivity

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Source: housing.com