A home in a gated community may seem idyllic — with privacy, security and access to a park, jogging track or other neighbourhood facilities, with the benefits of living in an independent home. But even if a project is marketed to you as a ‘gated community’, you cannot take these amenities for granted as local authorities may not recognise the concept of gated communities.
Then why should I pay a hefty premium for a gated layout, you may ask. That’s why you should take note of the following risks before you make your purchase decision.
No gates allowed
A case in point is the recent issue faced by the residents of Classic Orchard in Bengaluru. The Bhruhat Bengaluru Mahanagar Palike (BBMP) officials decided to demolish the gate and compound within the layout, so that the road inside could be accessed by the public.
The developer had earlier relinquished the roads to the BBMP, as a road is public property, says Viswesvarya Upadhyay, honorary Vice President of Classic Orchard Resident Welfare Association. A High Court ruling in May 2015 in Kochi noted that a road or pathway dividing any large tract of private land into plots becomes a public road if it connects more than one plot. It does not have any exclusivity and the individuals must yield to the common good.
Vineet Relia, Managing Director, SARE Homes, says that the rules in Haryana seem to indicate that communities may construct gates on the roads leading to their colony, but access to the public cannot be denied.
Buyers may not consider public access to be a significant issue when an area is still in the early stages of development, notes Santhosh Kumar, CEO, Operations & International Director, JLL India. But as the locality develops, public access to the roads may increase. This can peg up maintenance costs and require enhanced security.
Not just roads, facilities such as parks built by the developer in open space areas inside the gated community cannot be treated as exclusive property of residents either.
Aarthi Lakshminarayanan, Partner, Dua Associates, says that in Chennai and other towns in Tamil Nadu, the internal roads and open space reservation areas in residential layouts measuring over 10,000 sq m are required to be gifted to the local bodies or other authorities, prior to obtaining planning approvals. Once they are gifted under a registered gift deed, they come under the custody of government authorities and become public roads and recreation areas. The residents may not be able to claim any exclusive rights over these properties.
There have been instances of builders encroaching on the open space nearby and including that as part of the common area in the marketing brochure to woo buyers.
Also, the developer may retain ownership of the club house and other facilities and let it out to non-residents. The rules, however, require that common facilities be handed over to the Home Owners Association and be maintained by them.
For a home buyer, all this adds up to additional homework when buying in a gated community. For instance, plots in many private layouts may be sold without basic amenities such as road, electricity, drinking water, underground drainage and roadside drains. Recently, the Mysuru Urban Development Authority disallowed private developers from selling sites until the work on infrastructure, as per the approved plan, was completed. You must, therefore, ensure that amenities and promised features such as club houses are built or clauses put in to protect you from non-delivery or delays.
Sharing of infrastructure such as club house must be clearly stated. Dates must also be provided for the expected handover of these facilities to the residents’ association.
You must ask for the full plan for the entire layout, not just your home and get the legal due diligence on the entire area, advises Sangeeta Banerjee, co-founder, of a real estate portal. You will then know which land belongs to the builder or the government and be aware of any legal issues in common areas. And rather than each individual spending money to do legal checks, allottees could pool resources to engage a lawyer, she says. You must also ask the developer to show permissions/licences and other approvals from the concerned authorities. This helps to find out clearly what comprises common area and the exact rights of the developer and home owners in the common area, says Relia.
The concept of a gated community is not explicitly acknowledged under the present real estate laws. Buyers end up paying a premium for a concept that is not backed by law, says Upadhyay. Also, home owners’ association rules are governed by co-operative society rules and not apartment association rules. As a result, enforcing bye-laws and collecting dues are a hassle, he notes. Until new rules are formed, buyers must be cautious and understand that the premiums they pay may not get them what the brochures promise.
Credits ET Realty