IMPORTANT WORDS AND CONCEPTS OF INDIAN PROPERTY LAWS
Allotee :
The person who is allotted the property, either by government or any developmental agency or by a developer or colonizer.
Apartment :
Means a part of any property, intended for any type of independent use, including one or more rooms or enclosed spaces located on one or more floors or any; part or parts thereof, in a multi-storied building to be used for residence or office or for the practice of any profession or for the carrying on of any occupation, trade or for business or such other type of independent use as may be prescribed, and with a direct exit to a public street, road or highway or to a common area leading to such street, road or highway, and includes any garage or room (whether or not adjacent to the multi-storied building in which such apartment is located) provided by the promoter for use by the owner of such an apartment for parking any vehicle or as the case may be for the residence of any domestic aide employed in such an apartment.
Appraisal Report
A written report of the estimated value of a property prepared by a certified Real Estate appraiser or a valuer of property which may include the extent of construction, the market value of the property from the point of view of quality of construction.
Appreciation
An increase in the value of a property over a period of time due to various market and economical factors.
Assessed Valuation
The value that a taxing authority places on real property for the purpose of determining the tax of the said property. In house tax parlance it is often named as Rate able Value or the RV.
Assignment Deed: A deed signed and executed by the owner of a property to transfer or formerly make over to another or transferring the personal estate to another person or setting over a right to another in a property.
Atrium:
Open large space in any built up structure which was initially meant to provide good look, air and light to the entrance part of the structure. In modern times the facilities related to the building are being located in the atrium which is considered as a common space for all the owners of the apartment in a multistoried building.
Barsati:
A habitable room or rooms on the roof of the building with or without toilet and kitchen.
Basement:
It is a structure consisting one or more floors below the ground level of the building . There are restrictions on the use of the basement for inhabitation or human activity in various land use plans. In urban areas it is mainly used for locating the facilities of the building or parking.
Bhumidar:
A Bhumidar is of the class of a tenure-holder under the Delhi Land Reforms Act, 1954. He has the right to use land for any purpose connected with agriculture, farming, pisciculture or poultry. He has no right to use the land for industrial purposes other than those connected directly with the aforesaid activities.
Built-up Area:
Includes the carpet area, the wall thickness and the covered part under the premises.
Carpet Area:
The actual usable area of an apartment/office unit/showroom etc. minus Wall thickness. Simply put, it is that area within the walls where you can actually lay the carpet.
CBD or Central Business District:
The central commercial area and its immediate radius of 2 – 3 Kms, as a radius , typically located towards the city centre, which forms the hub of all major commercial activity of a city. Most of the larger corporate entities, large retail outlets and financial institutions would be located in this area. The Real Estate prices here would be the highest compared to all the other locations in the city.
Change of Land use (CLU):
It is the permission to use the land for the purposes other than that prescribed under the zonal plan or the urban planning document of the area concerned. If is often allowed by the concerned landowning agency and the urban planning enforcement agency .
Clear Title:
A title that is free from claims or legal questions and all other encumbrances about the ownership of the property.
Collateral:
An asset (such as a car/home) that guarantees the repayment of a loan. The borrower risks losing the asset if the loan is not repaid according to the terms of the loan contract. In a housing loan, collateral would mean additional security over and above the security of the property being financed.
Common Areas:
Those portions of a building, land and amenities used by all owners or occupiers of the unit, who may or may not share the common expenses of their operation and maintenance. Common areas common corridors of buildings and parking areas, staircase, roof top, recreational area of the building.
Condominium:
A Real Estate project in which each unit owner has title to a unit in a building, an undivided interest in the common areas of the project, and sometimes the exclusive use of certain limited common areas. Each individual owner may sell or encumber his/her own unit.
Conversion charges: It is the charge determined by the local authority for using the land for any other permitted use.
Compounding of construction:
It is the regularization and admitted the deviations and excess of construction within the permissible limits of the building plan. Compounding charges are claimed for compounding and regularizing the excess construction within the permissible limits.
Completion Certificate (CC):
It is the certificate issued by the local authority certifying the completion of the building in all respects . It also certifies that the building is now fit to be occupied for human inhabitation and all construction has been completed in accordance with the sanction plan.
Covered Area: The ground area covered immediately above the plinth level covered by the building but does not include the spaces covered by
i. Garden, rockery, well and well structures, plant nursery, water pool swimming pool, platform round a tree, tank, foundation, bench, chabutra with open to and unenclosed on sides by walls and the like;
ii. Drainage culvert, conduct, catch-pit, gully-pit, chamber, gutter and the likes and;
iii. Compound wall gate, slide swing, canopy, areas covered by chajja or the alike projections and staircase which are uncovered and open at least on three sides and also open to sky.
Co-ownership:
When there are more than one owner for an immovable property, the status of the property is known to be of the Co-ownership type. A Co-owner can do whatever he wishes with his part of the property as long as he does not affect the share of the other Co-owners.
Debutter property:
A debutter is an endowment much less a trust although it can be created through the medium of trust in which the property vests in the trustees and the deity /God is the beneficiary. Not necessary that debutter be always a registered deed
Deed:
The legal document conveying title of any property.
De facto Possession:
The actual physical possession held without force or fraud is called Defacto Possession.
Dejure Possession:
Also called Juridical Possession, it means possession in the eyes of the law. This may not be accompanied by Defacto Possession. Even when the property is lying locked, the Dejure possessor is the Defacto possessor of the property.
Deposit:
A sum of money given to bind the sale of Real Estate or a sum of money given to ensure payment or an advance of funds in the processing of a loan. Deposit could also be the deposit paid to a landlord as part of a rental transaction.
Depreciation:
A decline in the value of property brought about by age, physical deterioration, functional or economic obsolescence, etc.
Due diligence:
Verification of the authenticity of the title of the property with its legal title.
ECS or Equivalent Car Space:
The ratio of car parking space to be maintained or money to be paid to the local authority against the plot of land. In Delhi it is prescribed @ 1 car per 50 Sq meters.
Earnest Money Deposit or EMD:
A nominal sum of money given as a token to the vendor, signifying the assent to a contract of sale or the like, that the parties are in the earnest or have made up their minds.
Encroachment:
The physical intrusion of a structure or improvement on the land of another. For example, a neighbor’s fence or construction that crosses over your property line.
Encumbrance report:
A report issued by Registrar of Assurances or Sub-Registrar’s office after due verification of the relevant documents certifying that the property in question is free from all encumbrances such as mortgages, leases, easements or restrictions.
Fair Market Value:
The highest price that a buyer, willing but not compelled to buy, would pay, and the lowest a seller, willing but not compelled to sell, would accept. In other words a value decided by the market forces.
Farmhouse:
A large chunk of agricultural land with some construction used either for the dwelling purposes, or as a storehouse or a out-house.
First Party:
The original purchaser or the alotte of any property from the landowning agency or the government agency.
Freehold Property:
A property where title paramount has conveyed the property in favour of the purchaser by conveyance/ sale deed with no restriction on the right of the holder of the property to further transfer the property. Record of ownership of the freehold property can be ascertained from the office of the sub-registrar. It can be transferred by registration of sale deed.
FAR or Floor Area Ratio:
It is the quotient obtained by dividing the total covered area (plinth area) on all floors multiplied by 100 by the area of the plot.
FAR=Total covered area of all floors x 100 / divided by plot area.
F S I or Floor Space Index
The maximum amount of construction allowed on a given plot of land. This is purely dependent on the plot area and would vary from one locality to another based on factors such as the road width. For example, in Delhi in a 400 sq. yard plot the area is 40% the distribution being 20% for the backspace and 20% for the front. In case of a 1000 sq. yard area the area set aside is 60% for the back and the front spaces.
High Rise Building:
The building which is above the height of 15 meters from the ground level. The requirements of various statutory compliances for a high rise building is different as compared to the building below this height.
Heir or legal heir:
The person who is the lawful obvious inheritor of an estate or a property.
Immovable Property:
Includes the land, buildings, hereditary allowances, rights to ways, rights to light, rights to ferries, fisheries or any other benefit to arise out of land, and things attached to the earth or permanently fastened to anything which is attached to the earth, but not standing timber, growing crops not grass.
Industrial Property:
Any property used for a manufacturing purpose. Areas where industrial activity may be carried out are specified by the respective local authorities.
House Tax:
Real Estate owned with the intent of supplementing one’s income and is not intended for owner occupancy (i.e. rental houses, apartment buildings, etc.).
Joint Ownership Agreement:
An agreement between owners defining their rights, ownership.
Landlord/Owner:
Any person who has a valid and legal right, title and interest in the property.
Laldora Land:
The rural land which is primarily residential in the records of the revenue department and does not attract the sanction process for any construction of any building . This land can be used for any purpose of residential or non residential use.
Lease :
It is a transfer of right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. The transferor is called the lessor, the transferee is called the lessee, the price is called the premium and the money, share, service or other tings to be so rendered is called rent.
Lease Hold Property:
A property “bought” for a certain period of time. The “owner” of such a property will have “bought” the property from the original landlord and is entitled lawfully to rent, lease or “sell” the property to a third party during the period of leasehold. After the leasehold period, the property goes back into the original landlord’s possession.
Loft:
An intermediary space create by introduction of slab between floor and ceiling of a room, passge or wherever it is provided with maximum clear height of 1.5 meter for storage purposes only.
Loan-to-Value Ratio (LTV) The ratio of the amount of your loan to the appraised value of the home. The LTV will affect loan programs available to the borrower and generally, the lower the LTV the more favorable the terms of the loan programs offered by lenders.
Long-term Capital Asset:
This means a capital asset held by an assessee for nothing less than thirty six months immediately preceding the date of transfer.
Rate Lock Option:
A written agreement guaranteeing the homebuyer a specified interest rate provided the loan is closed within a set period of time, usually within 60 days. The lock-in also usually specifies the number of points to be paid at closing.
Maintenance Charges :
Charges payable by the owners / occupants of a development (apartment complex / commercial complex / plotted development etc) towards upkeep & maintenance of all common areas and facilities. It is normally a monthly charge and the amount payable is dependent on the kind of amenities that are part of the project.
Master Plan:
The plan document issued by the state government of the local development authority or the urban development authority which determines the details of development and zonal plans of the entire area.
Mezzanine Floor:
An intermediate floor between two floor levels above ground floor and at least one side of it should form an integral part of space/floor below.
Mixed Landuse:
The plots or properties on which residential as well as some of the permitted categories of commercial activities can be carried on under the provisions of the master plan of the area.
Mortgage:
A legal document that pledges a property to the lender as security for payment of the loan.
Mumty: It is the cover of the stair, as structure with a covering roof over staircase and its landing buildt to enclose only the staris for the prupose of providing protection from weather and not used for human habitation.
Mutation:
Mutation means transfer or change of name in the records of the government for the concerned property.
No Objection Certificate or NOC:
A certificate issued by the concerned local authority that the plans are in order and conform to the guidelines and rules in force. In other words, the authority concerned has NO OBJECTION to the commencement of construction.
Occupancy Certificate or OC:
A certificate issued by the local development authority certifying that all necessary works have been completed as per the sanctioned plans and that the property is fit for occupation. The OC is issued after clearance from the water, electricity, sewerage, fire fighting authorities etc.
Owner:
Any person who has a valid and legal right, title and interest in the property.
Owner Financing:
A property purchase transaction in which the property seller provides all or a part of the financing.
Parking:
An area enclosed or unenclosed, covered or open, sufficient in size to part vehicles, together with a driveway connecting the parking space with a street or alley and permitting ingress and egress of the vehicles.
Parapet:
A low wall or railing built along the edge of a roof or a floor.
Property Tax:
It is also known as the House Tax and is levied by the local government on all properties as per the local laws. Property tax records also show the real owner of the property and the user of the property besides the extent of construction inside the property.
Realtor:
synonym of “Real Estate Agent”, a person who provides the professional services of sale, purchase or renting of real estate.
Refinancing:
The process of paying off one loan with the proceeds from a new loan using the same property as security.
Registration:
A legal documenting and subsequent recognition of a transaction under the State. This can either be a rental or capital transaction and there is a fee attached to registering a transaction, which varies from state to state.
Residential Property:
Any property, which can be used for residential purposes as per the planning of the area, master plan or the terms of the lease deed or allotment. These areas are specifically earmarked as residential areas by the concerned local authority. Of late the other uses of residential properties has been viewed very seriously by the local authorities and courts.
Security:
In lending, security refers to the collateral given, deposited or pledged to secure the payment of the loan.
Super Built-up Area:
The plinth area along with a share of all common areas proportionately divided amongst all unit owners makes up the Super Built-up area. The common areas include corridors, balconies, swimming pool, garden, clubhouse, the lift wells etc.
Stilt:
The common area of the building which is to be used for provision of the facilities of the structure, which can not be used for any other purpose.
Tehsildar:
The important official of land revenue department who orders for the mutation, entries of names of purchasers inside the land revenue records , NOC for sale and transfer of land, Land use certificate and various other important and vital functions in relation to the land revenue matters.
Revenue authority or officer empowered to impose and collect revenue from a particular jurisdiction.
Tenant:
One who is not an owner but enjoys possession of a property from the owner on certain specified terms and conditions for a temporary period.
Title:
The document that provides legal evidence that the person has the right to the possession of the land.
Title Search
An investigation of public records into the history of ownership of a property to check for liens, unpaid claims, restrictions or problems, to prove that the seller can transfer free and clear ownership.
Transaction:
Any activity that leads to an exchange between two parties – buyer and seller/landlord and tenant etc.
Under-valuation:
A value of the property that is lesser than the fair market value. Registration fee for a property is based on the value of the property in case of capital transaction or rent in case of rental transaction.
Unauthorized construction:
A construction which is not in accordance with the sanctioned plan of the structure or is in excess of the sanction limits or has been constructed without sanction of the local authority.
Upper Ground Floor:
It is the construction of the ground floor with some elevated level from the ground either due to topography of the area or due to construction of a raised basement floor of the structure. The overall height of the structure is taken from the upper ground floor level.
Zones:
Parts of a city or town are allocated and categorized into zones, which in turn will have a bearing on factors like type of property that can be constructed, number of floors allowed for construction, etc.