Overtime it’s noticed that lands within estates have proven to have more economic value as against similar lands in the same axis and this is simply as a result of the proactive nature of gated estates. These estates are planned from scratch to meet the needs of the residents which results in the increased economic value.
As good as it is to invest in these estates one should be very much aware of the cost implication of owning one before initiating the process, to allow for proper planning and to avoid feeling cheated or exploited when the transaction is concluded. Like every property transaction the cost to be factored into the transaction should always be more than the actual cost of the land, fees like agency fees, legal fees would have to be considered.
Most private estates provide all the amenities within the estate and the breakdown of these costs is shared across all the units in the estate which leads to the extra costs in buying a land within an estate. Some of these costs include:
Development fees: These fees usually cover the costs of creating a drainage system within the estate, the cost of building roads, perimeter fencing, landscaping, Electricity supply to the estate.
Legal Fees: Often times the Real estate company is in charge of documenting the entire transaction (deed of contract) which is the reason this is being paid.
Survey : Most real estate firms have surveyors in house and this allows them provide this service to individuals who subscribe to their estates .
Architectural Plan Approval: While this would only apply to individuals who plan to develop their lands and may not apply to investors who want to hold land and resell after a period of time nevertheless this fee should be taken into consideration.
Electricity: This is very different from the normal light bill that is being paid monthly or annually, in this case the estate provides the infrastructure for effective distribution of electricity and residents make a one time payment to gain access. While this can vary from one estate to another be sure to find out what the policy is with the estate you subscribe to before you do.
Other important information to find out include:
Estate Delivery: If you plan to be an investor (less than five years) this is very critical and would determine if you get your money trapped or not, you would need to find out when the estate is due for delivery and its existing phase as at the time of purchase. It’s been noticed over time that primary investors of estates still on sale have a very difficult time Liquidating their assets and most who eventually do have a large chunk of their profits forfeited.
Management: How will the estate be managed? Will it be outsourced, managed by the developers or by the residents this is another information that should be ascertained.
All these questions can be gotten before purchase, always remember to get as much information as you need to make an informed investment decision.
Thank you for reading.
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