Verify the Developer's Reputation
Before anything else, scrutinise the developer's track record. A builder's promises are only as good as their history of delivering them. Look for developers with specific, successful experience in redevelopment, which is more complex than building on vacant
land. Check their financial stability, past projects, and reputation for quality and timely delivery. A developer with a history of stalled projects, delayed rent payments to original tenants, or multiple legal disputes is a major red flag. Ideally, choose a developer with at least three completed redevelopment projects.
Check for MahaRERA Registration
The Maharashtra Real Estate (Regulation and Development) Act (RERA) is your primary shield of protection. Every legitimate redevelopment project with flats for sale must be registered with MahaRERA. You can visit the MahaRERA website to verify the project's registration number. This portal provides critical details, including all project approvals, the sanctioned layout plan, and a legally binding completion date. A project not registered with MahaRERA is a significant risk, as it operates outside the key legal framework designed to protect homebuyers.
Scrutinise the Core Legal Documents
Redevelopment projects have a complex paper trail that you must inspect. The most critical document is the Development Agreement (DA) between the housing society and the developer. This document outlines the terms of the entire project. Additionally, verify the property's title for at least the last 30 years to ensure the seller has a clear and marketable title to the land itself. Also, request a copy of the Intimation of Disapproval (IOD) and the Commencement Certificate (CC), which are essential municipal permissions to start construction. Without a valid CC, any construction is illegal.
Understand the Society and Member Consent
The project's viability depends on the original housing society members. New rules require at least 51% of members to consent to the redevelopment. However, a higher consent rate (over 70%) is preferable as it reduces the risk of future litigation from dissenting members that can stall the project. Ask for the society's General Body resolution that approved the redevelopment and appointed the developer. Also, inquire if the existing members are receiving their transit rent on time, as delayed payments can be an early sign of the developer's financial distress.
Verify Building Plans and Carpet Area
Do not rely on glossy brochures or verbal promises. Insist on seeing the building plans that have been officially approved by the municipal authorities. Ensure the flat you are interested in is part of the approved plan. Most importantly, get the exact carpet area mentioned in writing in your agreement. The carpet area is the actual usable space within your flat's walls and is often different from the super built-up area used in marketing materials. Any promises regarding amenities, specifications, or features should also be documented in your legal agreement.
Check for an Encumbrance Certificate
An Encumbrance Certificate (EC) is a crucial document that confirms the property is free from any legal or financial liabilities, such as an existing mortgage or loan. This certificate can be obtained from the sub-registrar's office and provides a history of all transactions related to the property. A 'clean' EC is essential to ensure that you are buying a property with no pending dues or third-party claims that could lead to disputes later. It is a fundamental part of the due diligence process before signing any agreement.
Review the Agreement for Sale
Once you are satisfied with the initial checks, the next step is the Agreement for Sale. This is your primary legal contract with the developer. Read every clause carefully, paying close attention to the payment schedule, the possession date, and any penalty clauses for delays. The agreement should clearly list all the specifications, amenities, and the final carpet area. It is highly advisable to have a property lawyer review this document before you sign it. A lawyer can spot unfavourable clauses or ambiguities that you might miss.
