Buying a home/apartment in Bangalore ...

Given the current real estate scenario in Bangalore, this is easier said than done. If you try to do this in very advance, you might save some cash. However, risk and reward go hand-in-hand, right?


Risk with buying early is safeguarding the property in Bangalore. If this is a site, you need to make sure it is secured and nobody is going to occupy it. With Bangalore commute scenario, it becomes a challenge for friends/family to do that on a regular basis. If you buy an apartment, either you have to leave it vacant or rent it out. If you leave it vacant, you are not generating any returns for the money invested + paying the maintenance fee etc. Leaving it vacant is safe in most of the good apartment complexes. If you going to rent it out, make sure you pick somebody whom you know well or have some connection(thru' friends etc). Have heard nightmare stories where tenant is not paying the rent, refuses to vacate and the renter is even scared of going and doing something since the tenant is not 'easy' to deal with.


Best option is - look for a new construction from a reputed builder. Once booked, they take at least 2 to 2.5 years to complete and if you plan in advance, you will have a place to settle down once you R2I. Make a trip, study the location, have a chat with the builder and decide where you want to buy. You would need at least 2 weeks of time to do this, provided you have done some homework before you arrive (i.e, short-list the area where you want to move based on work and school preferences, short-list couple of projects that you want to visit, check with family/friends etc).


Here are some things to keep in mind:

• Go with a reputed builder like Prestige, Sobha, Mantri or Salarpuria (I am giving free advertisement for these folks :-)). You can trust their quality to some extent, which can be a big challenge with other builders. You don't have much choice when it comes to apartments for controlling construction quality but reputed builders want to keep their name.
• Bigger projects(i.e.., multiple blocks with good amount of open space in plan) tend to have much more open space allocated and are likely to have super marker etc within the complex.
• All of the apartments are dependent on borewell water or water supplied by tankers. If you are buying a already constructed flat, check to see whether they are entirely dependent on tanker water. Source of such water is unknown and also there is dependency on water mafia(yes, there is one like that!) - in some of the apartment complexes, they need tanker water only during summer but they end up buying all the time anyway since water mafia refuses to supply only when the apartments need the water and insist on constant supply! The water bill can add up to Rs. 5000+ and this is happening in many places - give a BIG thanks to our city planners and developers, these things are not taken into account when building permits for high-rises are given :-( As long as their pockets are filled-up, nothing else matters around here...

Buying a flat which is already built:

• You are paying a premium for this but it could be worth it. New flats normally sell in the range of 45 lakhs to 65 lakhs(for 3 bedroom, with 1500 to 1800 sq. ft area), based on the location. When you are buying second hand, you would end up paying 80-90 lakhs. However, for that premium, you are getting few things in return - the home owners association is already established, most of the things like water supply, gym, vendors(for milk, water, newspaper etc) and if there are major challenges in construction, builder would have possibly already addressed it. 
• In this case, check about the occupancy rate. If there are very few owners staying, likely that many things are not already established and will take some time to get established. 
• Check to see if there are friends staying in the complex that you need. There will be internal postings (in places like apartment adda or common floor) where owners directly post for sale/rent. This will save you agent commission, which is normally 1% of the transaction. For rental, it is one month of rent, which can be negotiated a bit down.

Some of the areas where large projects are ongoing in Bangalore:
Sarjapur area
Mysore road area
JP Nagar, BTM Layout
Whitefield, ITPL area
Hebbal/New airport area


18/02/2012:
One update on this topic - don't buy a property from any of the builders (even the reputed one), without consulting a good lawyer. Here is what I heard from a lawyer - even builders like Prestige do a 'shoddy' work when it comes to having proper paper work. Once the builder is done and hands over the property, it is not their headache to deal with legal issues that can crop up. These properties are taken from farmers and multiple owners and any legal action/claim from them can put the whole property into a legal mess. So, buyer be aware and make sure property has clean title.


Updated, 16/05/2012: 
If you are reading this post, you might be interested in my latest post from yesterday, which further expands this topic, with specific details of paper work...
http://r2idiaries.blogspot.in/2012/05/buying-property-in-bangalore-expanded.html