When choosing a property, many buyers focus on factors like built-up area and attached amenities. However, the most critical factor in any real estate purchase – the land itself – is often overlooked, especially in the case of apartments. When an apartment is purchased, the buyer is allocated a certain amount of the land as their Undivided Share of Land (UDS). This share has no defined boundaries and is associated with every flat built on that particular plot.
Purchasing a new home is a complex task that requires careful consideration of many factors. Location, size, and developer are just a few of the elements that must be taken into account to get the perfect property. Too often, buyers make their decision based on the built-up area or additional amenities without giving adequate thought to an essential aspect of the purchase of the land. This is especially true in the case of apartments, where ownership is typically allocated as an undivided land share. It is important to understand the legal implications of this arrangement and its significance concerning the property’s overall value for apartments with UDS in Chennai.
When you purchase an apartment, you are acquiring two separate entities. The first is the actual unit where you and the other owners will reside. The second is a stake in the land on which the property is situated. This latter share of land owned by the individual flat purchaser is referred to as an undivided land share or UDS.
The legal implications of undivided land share make it an important part of any real estate deal. The compensation a flat owner will receive if their building is demolished for reconstruction or acquired by the government will depend on the percentage of undivided land share they own.
The amount of space each apartment owner has access to must be in keeping with the size of the land on which their building has been constructed. In the case of cooperative housing societies, the space legally allotted to each shareholder must be clearly stated in the society’s name, as flat owners are also shareholders.
The Undivided Share (UDS) is a ratio that measures the amount of space an individual apartment unit occupies compared to the total number of units in the building and the total land area.
To calculate the UDS, divide the square footage of an individual unit by the sum of the square footage of all units in the building multiplied by the total land area. For example, if there are 5 flats in a building, each with 100 square feet, and the building is situated on 1000 square feet of land, then 200 would be the UDS.
Entire built-up area of an individual apartment / Addition of all flats’ area (built-up) x Entire Land Area of that project.
When you are ready to purchase a property, be sure to get a copy of the agreement between the builder and seller. This document contains important information about the UDS in flats/ UDS in apartments. Having this information will help you make an informed decision about your purchase.
It is vital to ensure that your agreement includes a section dedicated to the Undivided Share in Land (UDS). This figure should be stated clearly in percentage terms or exact square footage. The same number should be included in the sale deed for undivided share of land during registration. Having this figure agreed upon and documented will help avoid any potential conflict or misunderstanding later on.
It is vital that the amount of land you own matches the amount of space that is allowed to be built on it. The Floor Space Index (FSI) typically allows for 1.5 times the size of the land plot, meaning that in most cases, the land should be 1.5 times the size of the flat. However, without any rules in place to enforce this principle, there have been many instances where the UDS and built-up area do not match. This discrepancy can pose problems down the line if the property is redeveloped, as benefits will be determined based on land ownership patterns.
It may be challenging to divide the leftover space according to the original building’s proportions. If that’s not possible, then the present owners should try to cooperate and rearrange the space. The builder won’t be able to construct anything new on the terrace unless everyone agrees to a revised plan.
It is essential for buyers to consider a home’s UDS when making their purchase. However, in some cases, homeowners are willing to accept a lower UDS in order to save on costs.
When you buy a property that is under construction, you will need to pay stamp duty on both the land and the structure. In the states like Tamil Nadu, you will need to pay stamp duty in two installments. First, the property is registered in your name, taking into account your land ownership (known as “first ownership”). Once the construction of the property is finished, the property is registered again, and this time stamp duty is calculated based on the property’s total value. Therefore, if you show a lower value for the land in the property papers, you will end up paying less in stamp duty.
In Chennai, many builders provide users with around 50% UDS. In order to be profitable, one should choose to buy apartments in Chennai that provide between 50-60% UDS. At Isha Homes, we are keen on delivering sufficient UDS to our customers to enable them to gain profit considering the investing options.
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