A method to help you buy land in Chennai

Do you feel the time is just right for you to invest in real estate? Contrary to what the ads scream out, buying property is not all that easy. Here is what you need to consider before making the investment:

1. Loan ability – Even if you are financially secure enough to buy the land on your own, do a quick check to see if the property qualifies for a bank loan. With stringent bank rules, only approved construction projects will be eligible for loan on hand. To ask to see papers from the bank, you will be able to assess the financial viability of your investment.

2. Project clearances – No building project can move forward without the following clearances, so be sure to look for them:

      (a) CMDA Approval – Any building project within city limits need to be approved by the Chennai Metro Development Authority (CMDA.) Any developer with credibility will have a CMDA approval number on all of its layout drawings. Even if you are buying a property that already has a building constructed on it, check for the approvals before you decide to buy it.

     (b) Panchayat Approval – Technically, no projects or land down the ECR towards Pondicherry can get approval and despite that there are developers promising beach facing projects. They get their approval through the Panchayat Approval System where every village has an autonomous independent body – the Panchayat. They have authority to give approvals for houses ranging from 750 – 2,000 square feet.

However, you will not get an approval for land without the land being under your name first. Which means you will have to buy the land first and then get the go ahead from the Panchayat. The Panchayats gain a lot by having these projects being
built, as the tax they get from the development project aids in the growth of local economy. Once it is approved, a period of 2 years is given to start building and the failure to do so will result in having to revalidate the approval. The Tamil Nadu Electricity Board (TNEB) also needs to sign off on the project.

The catch here is, that the Panchayat in entirety cannot give approvals and even if they issue a ‘No Objection’ certificate, it can still be an illegal project. The approval needs to be signed off on by the DTCP office who could still turn it down.

3. Land Title: This is one other major consideration and has to be looked into with diligence. The land developer in chennai should possess a clear title of the land he is selling and we as lay men are not in the least qualified to check this. Any friend who has just introduced you to the seller is also not capable of checking these issues. You surely need a professional lawyer who can scrutinize the land titles and do not expect a criminal lawyer to be able to do this for you.

This would amount to visiting a psychologist when you have a stomach pain. Ensure that the seller has purchased the land in his own name and that the sale deed is there to prove the same. If the seller happens to be a broker or a land developer, he may not possess the sale deed in his name. He may be operating with a “sale agreement” from the owner or the actual seller and will hold a “power of attorney” which can be considered legally valid, but these could be full of risks and forgery. In order to verify the validity of each document you need to employ the services of a good lawyer and a person of good standing in the profession who is also well-versed with these situations.

4. “Patta” in the name of the owner:
This is a must and is similar to “Katta” in N India and Karnataka. While the sale deed happens to be a document verified by SRO (Land office of the Sub Registrar), the patta mentioned here is one issued by the district collector’s office and represented by the taluk administrator. The seller of your property may not have the patta and may tell you that the patta is in the previous owner’s name etc. This should not be acceptable to you and if you decide to buy such a piece of land you may end up spending months on end or even years working through the complex system to get your Patta. With no assurance this will happen and you being open to many risks in the process including claims from previous patta holders of the said property, we advise you be abundantly cautious in this aspect.