CREDAI launched a campaign to help buyers with purchasing a share of undivided lands in Hyderabad.

Investors may face risk if they purchase an undivided share of land. A campaign has been launched by the Hyderabad Leadership Team of the Confederation of Real Estate Developers Association of India (CREDAI) that is headed by P Rama Krishna Rao, along with Chairman, V Rajashekar Reddy, Secretary-General, and other members.

Owner of an undivided share of land (UDSL) for an apartment or commercial use, CREDAI Hyderabad says, usually the owner, enters an MOU with the purchaser in terms of purchase, time for delivery of the property and other aspects. The deal shall be made as a party of purchasers for an undivided share of the land or acquired by the purchaser. After that, the selling price shall be paid to the owner of the land. Upon the sale act's execution, the purchaser enters into a construction agreement-cum-general power of attorney in favor of the owner. The purchaser then entrusts the UDSL purchased by him based on an act of sale in favor of the owner.

Builder agrees to construct the project and allocate the apartment or commercial space originally agreed to be sold by the builder to the purchaser. In this type of sale, the property is sold far below the market price. These sums cannot be enough to construct and deliver the building – placing the investor 's money at high risk.

Other risks include that the transaction exposes the purchaser (UDSL) to the builder's performance risk of completing the project. If the builder fails to complete the project during the specified period, the purchaser will not transfer his UDSL or the apartment or commercial space to any other party. Another significant point is that, in the procurement of UDSL, the purchaser is deemed to be a 'promoter' under RERA and responsible for the financial risks and other obligations set out in the Act relating to the failure of the contractor in the delivery of the project.

P Ramakrishna Rao, President, CREDAI Hyderabad, said, "All under-construction real estate or new projects whose building permits are approved on or after 1 January 2017 and are built on more than 500 square meters of land, including more than six units, are subject to Telangana RERA laws. Buyers should be alert and ensure that registered TS RERA projects are purchased. This will secure the hard-earned finances of home buyers.

Besides, V Rajashekar Reddy, Secretary-General, CREDAI Hyderabad, said, "The RERA-approved selling process would offer full validity to the purchase and approval of land values by relevant government bodies such as GHMC / HMDA / DTCP, which can be easily checked. For RERA registered ventures, sales are properly pursued in a formal process and are covered by specific RERA clauses.

Registration with TS-RERA requires developers to provide relevant information on properties, such as details of the promoter, sanctions and approval plans, the total number of units and their carpet location, etc. This means that developers have all the necessary approvals and are responsible for what they do. Implementation of RERA has placed an end to indiscriminate launches by developers and ensures that all approvals are in place before any new project is launched, points out CREDAI Hyderabad.

As a portion of the sum is credited to a separate bank which the builders are liable to use for the construction of the house, a sum paid by the purchaser shall be covered by the RERA act. Telangana projects have granted registration search numbers and are permitted to market their project, which is only approved by RERA. In the event of a delay in the project, developers are liable to pay an interest rate of 2% over SBI's marginal cost of lending to the borrower.