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What is “Undivided Share in Land” and why it should be in mentioned your agreement ?

by Manish Chauhan · 73 comments

You bought your “Dream Home” and you are on top of the world. The joy and pride you have after buying your home is amazing. The property is at great location and the prices are appreciating, and you feel you are the Hero ! . Now you want to sell your flat for some reason and you are more than confident that you will get a buyer and the deal will take just few weeks and you will be bathing in cash from top to down.

undivided share in land india

Prospective buyers have started meeting you and they want to buy the property, but they are all rejecting it. They are “informed investors” who take care of every single detail and they ask you that killer question -

Everything is fine, but where is your undivided share of land (UDS) in agreement?

You are wondering whats going on, quite amazed only to realize later that you were only sold the building which is depreciating each moment, but “LAND” , which is the real thing is not owned by you.

You are SCAMED or FOOLED ! or both ! . Let me introduce to the term “Undivided Share of Land” or UDS as its called generally in real estate world and why you cant ignore this at any cost while purchasing properties.

What is Undivided Share of Land (UDS) ?

I will keep it short and simple. Undivided Share of Land is the share of land owned by you when you purchase the property. Basically when you buy a flat or apartment, you are buying two things

1. The constructed building – where you actually reside
2. The proportionate share on the land, where the whole property is built

The Price Appreciation in real estate actually is the appreciation in land prices, because technically the building will depreciate overtime. Its not that cement and concrete structure which is the prime thing, but the land. Have you ever thought what will happen if there is an Earthquake and the building collapses ? What is in future, the govt wants to acquire the land for some national project and wants to give compensation to you ?

Leave all that, imagine in future your building after many years needs to be redeveloped and a new construction has to happen. At that time, the amount of land you own will matter. Note that incase of co-operative societies, the Undivided Share of Land might be on the name of society and not on the home owner name, because they are share holder in the society, which is fine.

The sum of all the flat owners UDS has to be equal to the property land size. You should also know that the undivided share of land will be proportionate to your property area.

Example 1 – If there is land measuring 1,000 sq and there are 10 flats or equal size is constructed on that land, then each owner will have 10% of the land as his/her share.

Example 2 – Lets say there is a big township where 100 units of 2 BHK flats of 1,000 sqft and 50 units of 3 BHK measuring 1,500 sqft . Then the total constructed area is (100 units * 1000 sqft) + (50 * 2000 sqft) = 2,00,000 sqft . Anyone who owns a 1,000 sqft flat will have 0.5% share in the total land (Because 1000 is 0.5% of 2,00,000) and anyone who owns a 2,000 sqft flat (3 bhk) will have 1% UDS .

There has been cases where the builder has allocated less undivided share to flat owners and kept some part of himself and the original land owner (a lot of times, builder buy the land from someone else). Here is one such example

Current apartment which I am staying is 10 years old apartment. Building having total 24 flats. Whereas builder made total 26 undivided share. Other than 24 flat owners one share for builder and one share for Land owner. In the share of builder and Land owner they constructed few shops in building cellar. SOURCE

Important Point – The above example is for apartment system . If its a co-operative society, then the land share is equal for each member, irrespective of their property size.

What to check in Agreement ?

When you buy the property, your builder will give you a date when you have to come to registration office and all the agreement work will be done. Most of the times, builders are reluctant to show you the agreement copy. But they will be ready to share someone else agreement copy at their office or at the main site.

Just have a look at that agreement which is like a specimen or the format, on some of the page, you will see “Details of Undivided Share of Land” and it will be mentioned in percentage terms like “0.45%” or exact area in sqft terms. Just read the whole thing carefully.

Then when the actual agreement has to take place, you can then read the agreement in detail and make sure you look after this point in your agreement copy. A small tip here is that when builder calls you for registration, tell him you would like to come before 1 hour from the scheduled time and have a detailed look at the agreement, if possible also get a lawyer with you and have him look at the agreement.

So did you check your agreement copy and see how much Undivided share of land you own ?



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{ 72 comments… read them below or add one }

1 Joel Trinidade September 16, 2013 at 11:00 am

Dear Manish,

My builder has a different abbrevation for UDS . He calls it as aUn Disclosed Sin . You should never mention it , never talk about and never think about it. Leave along any mention of it in the agreement.

Thanks for this article. Can you please sometime take up the topic of share certificate in CHS.

Regards
joel

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2 Manish Chauhan September 17, 2013 at 6:58 pm

You are not kidding right ?

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3 Girish September 16, 2013 at 1:10 pm

Great infomation.
Thanks

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4 Manish Chauhan September 17, 2013 at 6:57 pm

Thanks

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5 bharat shah September 16, 2013 at 1:16 pm

thank you for important post about UDS. one more thing about land one should check whether it is free hold or on lease , as i understand. naturally for on leased land (i think, it can be max. for 99 yrs. , but i am not sure!) the price would not be as much as for free hold land. sometimes the advertiser advertises the leased land flat as free hold on the net sites. so always advisable to check the documents.

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6 Manish Chauhan September 17, 2013 at 6:57 pm

Thanks for sharing that point Bharat !

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7 Parag September 16, 2013 at 7:09 pm

Hi Manish,

Is it same like share certificate or it is something different?

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8 Manish Chauhan September 17, 2013 at 6:46 pm

Its just a line mentioned in the agreement .

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9 Puneet September 16, 2013 at 9:05 pm

Most important question is: Can you really do something about it? Really? Suppose if you find something in the agreement that you are not 100% sure of or do not agree to. What are your options?

If you think that you can ask for some changes in the agreement…think again please. No builder would entertain this. Many reasons would be quoted etc etc..
You are already in the Builder’s trap..have already paid the amount (most, if not all of it) to the builder.

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10 Manish Chauhan September 17, 2013 at 6:46 pm

Most of the builders provide the copy of an agreement (a sample one) to you after you have booked the flat (by paying token amount). If your builder is so much reluctant to give you any documents like that, then its safe to conclude that the decision of going with that builder was wrong :)

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11 Brajesh September 17, 2013 at 11:47 am

In my case builder has mentioned the UDS in the agreement. He has calculated it like this: – My shares = Super Builtup Area of the apartment * a factor.
This factor was told to me only the day I went to sign the agreement. They have not given any logic how the number was picked up. Now even if I ask them and they provide me with the total Super Builtup area and total land area is there a way I can verify the two?

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12 Manish Chauhan September 17, 2013 at 6:44 pm

You can get it done that just like that, you need to hire surveyor for this and it costs . But now if agreement is over, its kind of futile for you !

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13 Vijay September 18, 2013 at 9:37 am

Great info. I was aware of the leasehold/freehold and the idea that most leasehold ‘will’ end up being freehold at the end of the term. The info you’ve provided completes the circle, so to speak! Thanks. Have to now look up my apt.’s agreement to see what it says.

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14 Manish Chauhan September 18, 2013 at 9:56 am

Have a look fast :)

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15 Manish Chauhan September 25, 2013 at 3:04 pm

Welcome

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16 Ar. Makarand Rotithor September 18, 2013 at 3:40 pm

Dear Mr. Manish,
Thanks for sharing valuable information. I am surprised & doubtful for the statement, “In a co-operative society, the land share is equal for each member, irrespective of their property size”. Please confirm. Rest is fine.
I am an Architect worked for the builders when I was practicing. Now I am working at renowned developer company in Pune. Also I am facing similar kind of problems as an owner of the flat as well as a secretary of our housing society.
After working in various roles, I came to the conclusion that our govt. is mainly responsible for the most of the problems who is not implementing the law properly. And mostly people are also responsible who are reluctant to fight for rights. We thought that why should I fight for common interest? it makes many enemies too. Otherwise it is better to sale the flat and move ahead to run from one problem to the next another.
Why govt. does not make regulations which can be implemented with automatic effect? Recently Maharashtra Government appealed all housing societies to apply for the deemed conveyance deeds. It has again some procedure required to be done with unity where members do not come together. Hence genuine people get suffered. Instead of that if govt. would have declared that all old societies are now onward supposed to be conveyed their properties automatically. And builders and land owners should challenge in court for the dues if any.
Govt. is also changing FSI rules dynamically; hence builders and land owners avoid executing conveyance deed so that they could extract more and more what is wrong in that? To stop all this there should be some mechanism which will execute automatically to establish the rights innocent flat owners.
In our society, our builder sold us flats where legally he has not committed any clubhouse in our sale deed. But orally he was promised and also presented it in his brochure. He developed the same too. But now after our society formation he amalgamated our land with the adjacent land. And now he shared our clubhouse & access with added wings. This was shocking for all of us.
Hon. Supreme court declared that Parking is not saleable. But further guidelines were not given. Hence now builders are selling it under different head. Again it promoted new bad practices. Actually builder should load parking expenses to his saleable area. But he cannot compete with other’s rate. Actually common parking is the best source of income for the societies, but once allotted sold parking cannot be taken back by the society though the sale is illegal.
We people should push the govt. for these automatic executable laws. So that some cutoff dead line will govern the builders, land owners. The task is really difficult since the builders are the back bones of most of the political movements but not impossible.

—MAKARAND.

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17 Manish Chauhan September 25, 2013 at 2:27 pm

Thanks for sharing all that Makarand. While researching for this article, I read that point.

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18 shyju September 20, 2013 at 2:12 pm

This is very informative article

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19 sanjay pawar September 24, 2013 at 12:37 pm

Thank u very much for such imp.information . I own flat which is reg. Under society so is it fine or I have to check anything else

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20 Manish Chauhan September 24, 2013 at 7:19 pm

Still you need to check it in agreement

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21 Priyadarshi September 24, 2013 at 7:59 pm

Dear Manish,
what the buyer can do if this is not clear or not mentioned in the agreement
Do the buyer have some legal rights on this is
please do guide on this

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22 Manish Chauhan September 25, 2013 at 12:15 pm

No , there is no legal rights as of now . You only have an option of choice. Do you want to go ahead in such situation or not !

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23 Shiv P Chatterjee September 26, 2013 at 12:44 am

Hi MANISH ,Your articles are informative and bit alarming too as we realise that we should not have done that way after your alarm and we have already done it.
Anyways I have bought a Delhi development authority flat from the allottee but my question is
A. Do we have same UDS policy exists here too.?How much land is given to the dwellers in DDA?I hope the calculation is equal to all residences as it is a govt allotted land.?

B. I have heard these flats are on a lease of 99 years ?how to freehold them?

Please advise elaborately

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24 Manish Chauhan September 30, 2013 at 9:37 am

If its on leaseland , then it mostly wont apply , because you are not owning them, you are just leasing them

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25 SHIV September 30, 2013 at 10:39 pm

Hi Manish,
Thanks for your reply.So My building does not have any vaule in case of any incident you know what I mean?
So the only option left is to get it insured against any natural calamities.
Now If I get it insured say for 2500000 and I have a home loan pending of 700000, am I supposed to get 25-7=18lack if anything occures?
or
do you thing there is no value doing insurance for such property

please reply elaborately?
B.Regards

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26 Manish Chauhan October 7, 2013 at 8:29 am

Yes, As per my understanding, a leasehold property will be back to owner of land after lease ends . But still you can get the insurance and enjoy it for that much period

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27 bharat shah February 7, 2014 at 8:45 pm

the house insurance is for the structure cost only , the land cost is not covered whether it is freehold or leasehold , as i understand.

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28 Manish Chauhan February 14, 2014 at 5:41 pm

Correct !

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29 Umashankar September 26, 2013 at 10:14 am

Dear Manish,

Thank you for your wonderful insight.

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30 Manish Chauhan September 30, 2013 at 9:35 am

Welcome

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31 kulbhushan September 26, 2013 at 5:01 pm

Yes. This is indeed very important. I personally prefer to have a lawyer with me and pay him the required fees when going to buy any land especially for long term purpose…

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32 Manish Chauhan September 30, 2013 at 9:22 am

Thats always a better idea !

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33 astrosunil September 27, 2013 at 5:16 pm

Thanks for this nice article, was an eye- opener. How accurately we should check the fraction, say 85 units* 1200 sqft = 102000 sqft totally . Each owner share will be 1.176. Will this be approximated as 1% in the agreement ? Is this ok or we should insist to put as 1.17 itself ?

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34 Manish Chauhan September 30, 2013 at 8:58 am

Good question , I am not very sure on that . I have seen it upto 2 decimal points !

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35 astrosunil October 1, 2013 at 4:21 pm

ok, So I must take care to be accurate to 2 decimal places. Thanks !
If the appt land is not exactly rectangle , then these decimal places will definitely come into picture !

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36 Manish Chauhan October 7, 2013 at 8:22 am

How does it matter, if its rectangle , lets say 10X10 or 15×20 , and there are 13 apartments, then also share will be in decimals

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37 astrosunil October 7, 2013 at 1:40 pm

yes, you are right !

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38 Mukesh September 29, 2013 at 2:33 pm

Dear Manish,

Thanks for this informative article.

A query:
Does the UDS applies only in case of housing societies or does it also apply if the builder is not forming the society but an association? What rules apply in case of an association?

Regards

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39 Manish Chauhan September 30, 2013 at 8:41 am

It should apply always . It should be mentioned in the agreement . If its not, then your builder is kind of cheat !

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40 Mukesh September 30, 2013 at 9:26 am

Thanks Manish.

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41 Chanchal Sheik October 21, 2013 at 10:56 pm

Hi Manish,
This is a very useful article. Thankyou for the post. I am planning to book a small flat 1bhk 301 sqft on the outskirts of kolkata and the agreement reads “the Purchaser/s intends to acquire on ownership basis a Flat with proportionate impartible undivided share of land in the proposed building to be constructed on the said premises.”
It would be a real help what this means.

Regards,
Chanchal Sheik

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42 Manish Chauhan October 26, 2013 at 10:44 am

Looks good to me . Its the same thing which is mentioned in this article . But please consult a lawyer before moving ahead . It does not cost a lot of money !

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43 pappu October 25, 2013 at 3:19 pm

what is will be the in case of three floor & one aprtment for which map is aproved. Further roof rights has been sold to someone else, does that person ( who is having roof right) have any share in land?

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44 Manish Chauhan October 26, 2013 at 9:18 am

Pappu

Can you please open a thread on our forum – http://www.jagoinvestor.com/forum

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45 Murali Krishnan M S November 5, 2013 at 10:17 am

Hi Manish,

Thanks for the useful information. I have a confusion in arriving at a fair price for my apartment, which I want to sell now. It’s about 800 sq.ft and 471 sq.ft of UDS. The building is about 13 years old and the land cost is about 2.5 crores per ground. My question is: When I sell the apartment, is it 800 sq.ft PLUS 471 sq.ft? If yes, the total price of the deal would be 800 x 3500 + 471 x land cost per sq.ft? Please clarify, as I’m totally confused and don’t want to do something in haste and end up in heavy loss. Thanks and regards-Murali

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46 Manish Chauhan November 12, 2013 at 9:13 pm

Its a great question, but needs a lot of views and some brainstorming . I would really request you to open a thread on our forum and lets discuss it there – http://www.jagoinvestor.com/forum

Manish

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47 Chetan Ambi November 11, 2013 at 8:34 am

This is really an eye-opening article !! I was not aware of UDS at all. Thanks you Manish.

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48 Manish Chauhan November 12, 2013 at 5:48 pm

Welcome ! , spread the knowledge !

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49 ylokesh November 13, 2013 at 6:48 pm

Hi Manish,
This is really good article, I have a question in my mind. The builder has constructed two pent houses one for him and the other for the land owner which are not part of the actual plan and they can not go for registration. I came to know that the pent houses have UDS as well, if the flat is not as per the plan how it can have USD? is there any Govt body(in Karnataka) where this can be challenged?

The following is not related with UDS, but with deviation in the construction.
When the govt allows for regularizing the deviations ( akrama-sakrama) like pent houses, who should pay the the penalty? with out regularizing the deviated plan the flat owners would not get the Occupancy certificate with out which the sale dead is worth less? can we push the land owner and the builder to deposit certain amount in the association account towards regularizing the property when Govt announces? If they wont then what is the basis for calculating the penalty?

I said one question but asked many :-)

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50 Manish Chauhan November 14, 2013 at 2:25 pm

Actually this requires a lawyer to answer, but overall I can say that if things are not as per LAW , then please get it rectified now itself else years later you will really pay for this . I hope you know about CAMPA COLA compound case in Mumbai which is such a big thing now .

Meet a good property lawyer I would suggest.

Manish

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51 Hem November 27, 2013 at 10:48 pm

Thanks for such an eye opener article, Manish.

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52 Bharat December 19, 2013 at 10:23 pm

hii manish
i am having one one question in my mind.if there is a 5000 sqft area of land in sq.ft and there is a building of 5 floors in it .on one floor there is four flat of 1000 sq.ft
that is total 20 flats .then what would be UDS for each flat owner ?
weather it will be 1000 sq.ft for each flat owner. ?
if yes then 1000* 20 flat = 20,000 sq.ft > 5000 sq.ft of land then total UDS is not equal to land size.
or it will be like 5000/20 =250 sq.ft UDS for each flat owner

please clarify……

than x in advance.

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53 Manish Chauhan December 25, 2013 at 10:28 am

It should be ideally 250 sqft for each , 5000/20 ! . Builder can put lesser than that if he wants and keep some for himself :) .

Manish

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54 astrosunil January 27, 2014 at 7:22 pm

just FYI….SBI home loan application form has UDS field which you need to fill(I came across three or four formats of SBI application forms). So in case if builder has not mentioned in the agreement, insist on the same telling its mandatory field in SBI form & I need to have it in agreement. It also has carpet area etc. So get SBI or any any bank application form & get these parameters made official before signing on agreement.

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55 Manish Chauhan January 30, 2014 at 5:33 pm

Thanks for sharing that tip Sunil !

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56 Chitra February 12, 2014 at 5:13 pm

Very useful article about UDS. I m going to purchase a flat. Could u please tell me what are all things to check in the document so that it will be very useful for the buyers like me and also I just want to know what are all factors needed to calculate the amount for registration? My builder is saying from Oct, 2013 onwards, 2% Construction cost has to be included along with the registration. Thanks in advance..

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57 Manish Chauhan February 14, 2014 at 4:40 pm

Hi Chitra

I am not aware of this particular rule. Documents which you should check is mentioned here – http://www.jagoinvestor.com/2013/08/real-estate-and-property-terminologies.html

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58 Chitra February 14, 2014 at 5:35 pm

Thank you Manish. Useful Information. :-)

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59 Surendran March 26, 2014 at 11:19 am

Dear All,
i need a answer, i plan to purchase 2 BHK & its Fourth floor (P+G+4 ), but i am getting only 89 Sqft of undivided area, its worth to purchase the flat, the flat contains 60 Flat,

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60 Manish Chauhan March 26, 2014 at 11:52 am

Thats not the issue, the overall land on which the flats are constructed, you will get a share out of that land area only, so is X is the total land area, is X/60 somewhere near to 89 sqft or not ?

Manish

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61 Chitra April 5, 2014 at 7:46 pm

Hi Manish,
I am little bit confused and thats y i am asking this question. I have registered in a property websites to purchase a flat. So, i will get calls to see the site. Once real estate broker called us to see the flat and we went to see the site but we didnt like that site and left the place. After some days the same broker called us to see another site and we went to see the site but it was not in my budget and we left the place. Again, this broker called us to see the site and so we went to see the site and liked the flat and so we purchased a flat. After my registration is over, this broker calls us to give the commission. Actually we didnt commit any commission to this broker. I purchased a flat for Rs.27Lakhs. He is asking 2% commission now. We told him that we didnt commit him any commission and we told that since he has shown 3 places, we told him that we will give Rs.1000 and not beyond not. Now, he is asking 1% commission. We dont know what to do.. Could u plz anyone advice on this? Thanks in advance.

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62 Manish Chauhan April 10, 2014 at 1:54 pm

There is no reason to pay if things where never discussed and agreed on .. Tell him there is no reason to pay , where was it agreed on ? There is no ground to pay ! ..

Also tell him that you will do a police complain if they harass you !

Manish

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63 Chitra April 10, 2014 at 5:12 pm

Yes sir. We told him that we are not giving any commission. Finally, he scolded us for not giving commission.. Not to make things worst, my father told that he will give only Rs.5000 so that he wont be disturbing us.. I am not satisfied with my father’s decision. I told that since we didnt commit, there is no point of paying. Is this decision correct?

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64 Manish Chauhan April 10, 2014 at 5:37 pm

Yes, you should not pay even Rs 0 , Because they get commission from BUILDER anyways .. they get anywhere from 1% to 3% commission !

Why to even give Rs 5,000 ?

Manish

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65 Chitra April 10, 2014 at 5:42 pm

Yeah my father has told so that he wont be disturbing otherwise the broker will call again and again and disturbing…. Thats y.. This is my father’s decision..

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66 Chitra April 10, 2014 at 5:52 pm

Actually the broker is cursing us for not giving money and so my father has committed to pay Rs.5000. I will definitely advice if we get Property calls from website where u have registered, beware of brokers as they would ask to pay commission…

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67 Manish Chauhan April 21, 2014 at 4:21 pm

Hmm.. its your choice now .. better not give anything

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68 honey john June 10, 2014 at 4:19 am

my question is now adays flats are ornamented with club houses indoor game area outdoor game area provision stores etc does all this come under the total constructed area plz reply me asap bcoz i am in th verge of buying a flat with lots of amenities

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69 Manish Chauhan June 10, 2014 at 8:13 pm

I didnt get your question ?

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70 honey john June 11, 2014 at 8:18 pm

when calculating uds does provision stores provided within the plot is included under super builtup area?

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71 Manish Chauhan July 5, 2014 at 4:43 pm

I think yes it will be included !

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72 PRakash2014 July 17, 2014 at 8:18 pm

Hi Manish,

Request you to please help me with the following queries:
1. Can a flat in Bangalore be registered under a sale deed which specifies sale of UDS only with only value of UDS specified in the sale deed and not that of the built flat and the UDS? The flat is completed and the builder is waiting to get the OC.
2. The builder is refusing to add the details of the built flat in the sale deed stating that as per the customer agreements they are only selling the undivided share of the land and not the residential flat. Hence, the details of the Residential Flat and payment details on the flat cannot be incorporated in the sale deed
3. What are the repercussions of getting a flat registered with such a sale deed for UDS only?
4. If this is not legal , which authority has to be approached for a formal complaint against the builder? As it seems like the builder is doing this to save themselves from paying some tax . ( However please note the stamp duty and registration charges for the sale deed registration is collected and paid to the government for the whole value of flat and UDS)
5. If it is ok to go ahead with the registration, are there any precautions , dos and dont’s to be followed while registering an UDS only sale deed , are there any documents that needs to be collected later from the builder to show the building is completed?

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