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The real costs of land

Source : BUSINESS_STANDARD
Last Updated: Fri, Mar 29, 2013 20:40 hrs
​The worrisome thing about investing in homes

Ever since I came to Santiniketan, some acquaintances involved in real estate dealings had been telling me to invest in land. Since I had not bought even a tile by way of real estate in Mumbai, despite the best of financial advice, I thought I should now pay attention. Besides, compared to Mumbai, land prices here were so ridiculously low that it didn't seem like an existence-threatening risk. Four years ago, I finally succumbed, and along with two other friends, bought three acres of land, seven kilometres away from my present home.



Having no children whose future I need to secure, I have no love for real estate. I already have a house to stay in, and I knew I was not going to build another. My friends who stay in Kolkata said they wished to build a second home, and I had simply partnered with them for moral support.

The land was next to a tribal village and so unspoilt that we used to park our car a mile away and walk to it when we visited. Initially, the excitement was high and much planting of trees and fencing of the perimeter happened. Then, slowly, I began to feel I was being called upon to do more than my share - simply because I lived close by. Following up with the land registration office in itself was a project (it took three years for the transfer to happen).

But as my irritation quotient was rising, something happened to make matters come to a head. Almost overnight, a building sprang up next to our plot with a hoarding that read: Santiniketan Institute of Polytechnic. And, just as suddenly, I started receiving phone calls asking me whether we would like to sell. I told my partners that, with moneyed promoters now eyeing that land, it would be difficult to keep off squatters. So, unless they wanted to build the homes they desired, in a hurry, we should sell.

We spread the word and the offers we got took us by surprise. We made a deal that returned us our investment many times over. But the young man who bought it (I was surprised at the big pockets of an obviously small-town man) asked us whether we could sign "multiple" agreements instead of one. In our euphoria of unexpected loot, we agreed readily.

The "multiple" turned out to be 38! He had, between paying us an advance and the full amount two months later, actually sold it, in bits, to 38 people. He was just the facilitator, and if we signed 38 separate agreements, he would save on paying registration fees twice over. It was obviously not a matter of a few more signatures. On the given day, many brokers, sub-brokers, lawyers, deed-writers, affidavit-fixers appeared, and the show began. Those familiar with such transactions would know that this involves each agreement to be signed 10 times, in addition to fingerprints of all 10 figures a couple of times.

As I supplied endless cups of tea to all the hangers-on (whose knowledge about the areas they were supposed to be dealing in was appaling), I was wondering whether earning the money had been worth it after all. But after all the form-filling, it was at the registration office that we realised what we had let ourselves in for. For each form, the officials had to take our digital photo and a biometric impression of our left thumb.

This act repeated 38 times by each of the three sellers would have been painful if it wasn't hilarious. But, jokes apart, this experience will keep me from real-estate deals for a while.

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