Chennai Home Buyers Guide

Buying a home is a dream for all of us. Apart from the emotional quotient attached to a home
purchase, it also involves the biggest financial transaction you will make in your entire lifetime.
Considering the challenges faced by the end-users in this crucial event of your life, we bring you
our compilation of articles that will help you make a better decision for purchasing your home.
This Home Buyers guide will help you find answers to your questions/queries on the following:

Best Locations in Chennai

Best Time to purchase a House
o Should you purchase property in a Pre-Launch?
o Is 2016 the right time to take the leap?
o Is it prudent to buy property at a young age?
Important Checklists
o Things to check before buying a house
o Things to check before taking possession of a new house
Help-guide to a perfect Home Loan Application
Real Estate Glossary
o Complete Glossary of all Real Estate terms you need to know

Best Location for a Home in Chennai

Chennai has been expanding rapidly and residential property prices in Chennai have escalated the
fastest among the cities in India, witnessing an appreciation of almost three times of what they
were in 2007. Traditionally, buyers in Chennai have been hesitant to move to the suburbs,
however in the recent times areas like Old Mahabalipuram Road (OMR) have become hot spots
for real estate development in Chennai.
OMR is the great Chennai dream. The real estate growth around this 20 km stretch from
Madhya Kailash junction to Siruseri boasts of IT development and good infrastructure. The
stretch developed as a designated IT/ITeS corridor over is the second highest exporter of
information technology in India. The growth has fuelled real estate activity in the region and has
made the region desirable.
Here are top 10 reasons why OMR is the best place to own a home:
1. Infrastructure
The Government has given priority for infrastructure developments like water and sewage
connections on this road. So you will not face any problems of sanitation or water problems that
you would normally face in the city. Apart from this, the following are the major projects
happening on and around OMR.

Financial City Sholinganallur (All Banks under One Roof)

TCS SiruseriSipcot (Biggest Building in Asia for TCS)
Sports City Kalavakkam and Tiruporur (1500 acres)
Railway Link Taramani to Cuddalore via Tiruporur, Mamallapuram, Pondy
New By Pass Egatore (Siruseri) to Thaiyur (Beyond Kelambakkam Junction)
Fly Over 5 flyovers on major places (From Tidel Park to Siruseri)

Japanese Township

2. Proximity
OMR is the IT/ITES hub of Chennai and has big companies that have offices around the area.
A major advantage of living in OMR is the proximity to the IT hubs and all major growing
southern suburbs of Chennai. OMR is well connected to Mahindra World City, ECR, GST and
theELCOT SEZs. The Chennai airport is just 30 min drive from OMR and the TIDEL Park is
just about 10 minutes away.
OMR and surroundings have more reputed schools planned now than any other area.
Padma Seshadri School Coming up at L&T Eden Park
Gateway The complete school Sholinganallur
Abacus Montessori School Perungudi
Delhi Public School Nallambakkam
DAV CBSE School Thiruporur
The area also has high quality educational institutions like National Institute of Fashion
Technology (NIFT), Asian College of Journalism, SSN College of Engineering, St. Josephs
College of Engineering, Sathyabhama Deemed University, Hindustan College of Engineering,
Jeppiaar Engineering College etc. The National Maritime University, the first in India is currently
being built in Shollinganallur. The university complex will house an aquarium, national maritime
museum, food courts, and a hotel and residential complex. The ministry of shipping is also
seeking a public private partnership to build a five-star hotel in the complex.
3. Connectivity
The entire stretch of OMR from Madhya Kailash to Navalur has flawless connectivity with the
main city. Bus and suburban rail services are convenient and the proposed rail line from Chennai
to Pondicherry and Cuddalore, through Sholinganallur, Kelambakkam, Thiruporur and
Mahabalipuram, will be an added boost to the connectivity of OMR. The State government has
also considered the possibility of BRTS for the IT corridor.
4. Attractive residential projects
Buying a property in major locations of Chennai are not affordable to most people due to their
exorbitant prices. Also, with the growing technology and population, there is a steep demand for
living spaces at affordable prices. OMR offers you the best at low-cost living without
compromising on quality. Some of the attractive projects that Casa Grande offers are:

Casa Grande Cherry Pick Exclusive 2 & 3 BHK apartments with 40+ amenities
Casa Grande Aldea Thematic Landscaped Luxury apartments in Thoraipakkam
Casa Grande Pavilion Chennais Largest Villa community in Thalambur, OMR
Casa Grande Lanterns Court Luxurious 3 BHK apartments in Thoraipakkam
Casa Grande Avalon Limited-Edition Independent Luxury Villas in Perumbakkam
Casa Grande The Address Luxurious 4 BHK Apartments in Karapakkam, OMR

Casa Grande Pallagio Luxurious Mediterranean Villas in Thoraipakkam

5. Serene Landscapes
After a hard days work, imagine driving back to traffic free and pollution free environment that
has fresh air. Sounds refreshing, right? OMR offers just that. Moreover, it is also not too far
away from East Coast Road (ECR), which has the scenic coastline, offering breathtaking sights
of the sea. ECR is currently well connected to OMR through multiple link roads. Also in the
pipeline, are two more link roads planned at Neelangarai and Pallavakkam, which would further
enhance connectivity with ECR and other parts of the city.
6. Lavish amenities
OMR is enriched with properties overloaded with all the amenities that one would wish to have
in their dream home. Reputed builder like Casa Grande offer affordable and posh flats and villas
located at strategic locations in OMR. The community boasts of a multi-level grand courtyard in
the center with swimming pool, club house, lush podium garden area and apartments
overlooking the greenery. With a space of greenery, landscape, recreation and relaxation, the
amenities add the much needed color to your fast paced life. Casa Grande Pallagio are villas that
have an irresistible combination of a fantastic location & great price with thematic Italian styled
luxury Villas that have private garden space for each house and a large open terrace that doubles
up as party area.
7. Excellent Investment Opportunity
Owing to its locality and infrastructure available, OMR has become an attractive investment
option for multinational companies, real estate developers, home buyers and investors. Within
the last five years, OMR has seen a capital appreciation of about 50 per cent and 21 per cent hike
in property value. According to real estate experts, 1 acre of land on OMR, which cost Rs 75
lakh1 crore in 2010, now costs more than three times the same price. Adjoining areas of
Kundrathur, Mudichur, Padappai, Mannivakkam and Perungalathur have also seen price
appreciation, reaping the benefits of OMRs price appreciation. So buying a property now at
OMR will ensure that your propertys value will get immense appreciation in 10 years.
Therefore,even if you are not planning to move in right away, it is a great investment option.
8. Regular Rental Income
The demand for houses on OMR has gone up drastically due to the IT boom and the fact that
the area is home to several big and small companies. A simple 2-BHK flat earns a rent of about
12,000 -15,000. Renting out your apartment will be lucrative since the demand for properties is
always high!
9. Gated community lifestyle
Most apartments on OMR are townships and are inclusive of all amenities including ATM and
super markets. This makes life easy for home owners since they do not have to go out or worry

about the basic requirements. These apartments also give you the opportunity of to mix and
mingle with neighbors, having a better social life and staying fit.
10. Top hangout places & food lovers paradise
With big companies like TCS and CTS having big offices, there are employees from different
parts of the country. This leads to the possibility of a cosmopolitan lifestyle. OMR also now has
posh restaurants that have mushroomed over the course of time. Some of the popular
restaurants to visit in the vicinity are:
The Farm Semmancherry
Barbeque Nation Thoraipakkam
Moti Mahal Delux Kalaingar Karunanidhi Salai
Golden Dragon Padur
Buzz The Gateway Hotel Sholinganallur
With many posh restaurants and new-age amenities, OMR is guaranteed to give an elegant touch
to your home. The residential projects at OMR are filled with classy and sophisticated
architecture as well, so if you prefer sophistication, OMR is the place for you!
We hope, by now, you would have made up your mind towards investing in OMR. The prices
are soaring every day with growing businesses and job opportunities! So take your family to the
most ideal destination of the city and enjoy life at affordable cost!

Best Time to Purchase a Home

Why should you buy Property in Pre-Launch

Pre-launch of a realty project is the launch before the project is officially offered in the market.

The pre-launch is generally offered to the preferred or inner circle of investors and potential
buyers. Are you accustomed to getting messages and mails from real estate builders to buy
properties in pre-launch events? With super-attractive offers at stake, you might wonder if
purchasing in pre-launch property sale is a good idea. Heres 4 reasons why you should buy
property in pre-launch events:
1. Discounted Price Benefit
A project pre-launch is accompanied by lower than market prices offered with builders providing
discounts even upto 20-25%. Buying an apartment or a villa in pre-launch from a reputed builder
who has a strong track record of completion of products, ensures that your investment is safeguarded & risk-free.
2. More Options to select their preferred unit
Apart from the price benefits, the option to select your preferred unit is an added advantage.
You can make a choice based on factors like the preferred orientation or proximity to certain
project amenities. After the pre-launch, all remaining units are opened to the market during the
launch. Hence, your choices become constrained.
3. More Time to Pay
By purchasing in pre-launch, you are investing in a property that is still a couple of years away
from handover. There is a differential amount to be paid in different phases till the project
handover. The initial down-payment to book an apartment or villa in pre-launch is only nominal.
This can provide you ample time to organize your finances.
4. Return On Investment
There is a huge potential for appreciation of property prices if the purchased property lies in an
area that is currently underdeveloped with a potential for rapid development. For investors
looking for investments with large return on investments, areas like Oragadam, Sriperumbudur,
etc. can provide you multi-fold returns.
A thorough research on the builders and developers behind the project can help you make a wise
choice that mitigates all risks. Established and respected players in the real estate industry
generally take these risks into account and ensure the project goes through without hiccups. Prelaunch purchase of properties is the way to go for investors who intend to make multifold gains
from real estate investments.

Is 2016 the right time to take the leap?

With the Budget session close on our heels, now is the time when investments are a hot
topic around us be it tax saving investments or reorganization of finances or a new plan for
the upcoming financial year. If you were in two minds about buying a new house, this is the
best year to take the leap. Here are 5 reasons to buy a house in 2016:
1) Attractive Home Loan Rates
One of the most important factors that determine the cost of your loan is the interest rate.
Higher the interest rate, higher is your cost of long-term property purchase. After a couple of
rate cuts by RBI, the home loan rates have come down in a long time. 2016 can turn out to
be a good year to make the most out of the opportunity with more rate cuts expected to
follow.
2) Tax Benefits Deduction on Interest Payment
Home loan finance not only allows you to realise your dream of owning a beautiful home,
they also help you gain attractive tax benefits. The interest on your Home Loan EMIs qualify
for deduction. If you use the house for your own residence, then you can claim upto Rs. 2
lakh for deduction. In case of a rented property, you can claim the entire interest amount for
deduction.
3) Tax Benefits Deduction on Principal Repayment
The principal component of your Home Loan is available for deduction under the Section
80C of the Income Tax act. You can claim upto a maximum of Rs. 1.5 Lakhs under this
provision.

4) Why rent when you can Own

The most important reason for most people to be investing in a house has to be this- Even if
you had been living in a house for five years straight, it does not become yours. With the
increase in rental rates, the best possible solution is to move in to your own house. If you are
paying a substantial amount as your house rent, why not convert it into your home loan EMI
that will give you your own home and at the same time, form your biggest investment from a
long-term perspective.
5) Long-term Appreciation
Real Estate Investment can yield one of the best long-term returns in a fast-developing
country like India. With the fast appreciation in land prices, accompanied with growth in
infrastructure, purchasing a house can be the next multi-bagger investment. Metro cities like
Chennai provide the opportunity to invest in high-potential growth hotspots. OMR is one
such area that represents the great Chennai dream. The stretch developed as a designated
IT/ITeS corridor over is the second highest exporter of information technology in India.
The growth has fuelled real estate activity in the region and has made the region desirable.
You can check out some attractive projects here:
Casa Grande Aldea
Casa Grande The Address
6) Attractive projects
Riding on the infrastructure growth story, lot of attractive projects are coming up. With the
advancement in technology and aesthetics, houses are no longer seen as a place to board and
lodge. The pleasure of having all your amenities like swimming pool, gym, and play area
etc.in ones own house is the best.There is a growing demand for aesthetically built ultrasmart, living spaces that are technologically sound a well. Thematic houses are also a craze
now-a-days. For example, Casa Grande Arena is a dream for any sports-lover.
7) Financial Security
In case, you already own a house, you can still purchase a house and let it out for rent. The
rental income can complement your monthly income. The long-term Return on Investment
can be in terms of capital appreciation on property sale as well as the regular capital inflow
from rent. Even if you invest the rent in a simple Recurring Deposit, it will fetch you
approximately 8-9% per annum. This can enable you to provide a stronger financial security
for your family.

Is it prudent to buy Property at a Young Age?

Investing in real estate for most young people sounds like an old mans game. That partially
explains the trend to wait until the forties or fifties to start investing in real estate. The other
explanation can be attributed to the perception that you need to learn swimming (read garner
experience) before you jump into the sea. This article would break these myths along with ideas
to start investing in real estate.
1. Need more time in your young, busy life?
As you grow older, you bet you wouldnt get any more free time than now. Family. Kids. Home.
Career. In short, the older you become, the busier you are. So, throw the busy excuse out of
the window.
2. You need to have a fat bank balance to start investing in real estate?
Money is definitely important to invest in real estate. But, nobody said that that money should be
yours. Until and unless you have done some real bad work with your credit early on, you should
be able to land up an EMI based home loan.
3. Need to get experience before burning your hands in fire?
Knowledge forms the basis of any investment. And we are not denying that. There are millions
of books out there as well as umpteen investment gurus who have shared tips on investing in
real estate. So, get started fast and exploit one advantage that you have over the older generationthe ability to learn fast.
4. Learn to sacrifice the lollies for the gem.
If you want to be rich down the line, you would definitely be required to sacrifice some lowhanging fruits in the present. Forgo 1 vacation planned next year to make up for a couple of

down-payments. Or purchase a car at a cost level below than what you can afford. After all,
financial freedom comes at a cost.
5. Make the right moves. Doesnt matter if they are small.
You cannot score a goal without knowing to kick the ball. Start small but definitely make the
start. If you cannot afford a Luxury Villa at the start of your career, you can definitely start by
investing in a 2 BHK apartment. This start can give your ample returns over a period of time.
6. Get the plan ready. It helps to have a map with you on your journey.
Go to the drawing board or pull out a spreadsheet and set down your monthly budget. Push out
a couple of luxuries you can afford to forgo and plan the budget that can fulfil your monthly
EMIs for real estate investing.
7. Okay, you want to invest. But, what about the risks?
Roses do not come without the thorn. But if you are alert, you can avoid the thorns. Similarly,
when the question of risks comes into investing in real estate; the best time to take risk is when
you have 20-30 years of our job left than when you have 5 years to your retirement. Also, the
more you delay, the more you lose out on the power of compounding over the long time frame.
In short, investing in real estate at a young age is actually better than investing at a later age; quite
contrary to the popular notion. Hence, why dont you get started now? Theres never a better
time than now.

Important Checklists
Things to check before buying a house

Buying a piece of land or a flat is a cherished dream for many. Real estate is one of the biggest
investment you make in a lifetime and you need to your homework before you take the plunge.
Here is a guide on 10 things to check before you buy a property.
About the land
If you are buying a land, the first thing you need to do is make sure the land has cleared all legal
procedures. Ensure you personally inspect the land before you buy it. You need to make sure
that the title deed of the land is in the name of the seller. Also, you need to verify that the
sellerhas full right to sell the land and that he is the sole owner of the land.
Research in Location/Area
Location of the house is an important point for consideration. Whether you are buying the
house as an investment or planning to move in there, you cannot ignore the importance of a
good location. Ensure the growth of the area is good and the location has good schools,
supermarkets and other essential amenities close by.
Pricing
The price band for your real estate investment needs to be fixed before you start scouting for the
property. It saves a lot of time by helping you narrow down on your choices and at the same
time, makes sure you only fall in love with the ones you can afford. The best idea is to come up
with a maximum limit on budget and not exceeding the same no matter how attractive the
property is.
Legal due diligence
Buying a house involves a lot of documentation and it's best to go through the documents
yourself as well as consider legal consultation in case you are not acquainted with the terms
involved. Ask for copies of all necessary permissions prior to making any financial transactions.
Check the following documents and clearance certificates to avoid getting into any legal tangle in
future:

Land Record
Construction Clearances
Approved Planning
Land Use Certificate
Master Plan of the property
No Objection Certificates

Builder credibility
Selecting a credible builder is an extremely important step in buying a property. Research well
about the builder and the best way to go about this is to look for past projects of the builder.
Choose a credible builder like Casa Grande, who develops quality livings spaces.
UDS

While buying an apartment, buyers focus on flat area but completely forget about the land
ownership-Undivided share of land. An Undivided share is a share of land allotted to the flat
buyer while purchasing a property and it is registered in the name of the owner. Ensure
you check for your share of UDS before making the purchase.
How to calculate UDS?
UDS = Built-up area of individual flat / Sum of all flats built-up area X Total land area.
Percentage of common areas
The actual usable area of a flat you are buying may differ from the one you are charged for. The
common areas are the shared spaces on a single floor, and within a building in its entirety.
Finance/Loan
Planning your finances before you invest in a property is a wise idea. There are plenty of
financing options out there so make sure you research them all and pick the right option that
suits you the best. Make sure you have enough savings, before you apply for the loan.
Civic amenities
You must inspect amenities offered along with the property. Some of the important things to
check are fire alarms, garbage chute system, parking, lifts, power backup, etc.
Recreational amenities
Most apartments these days come with recreational amenities for residents such as club house,
swimming pool and gym. Special theme projects can offer a wider range of amenities based on
your preferences. For example, Casa Grande Arena is a heaven for sports lovers. You can target
a real estate project that caters to your needs and preferences.

Things to check before taking possession of a new house

Taking possession of ones new home is a moment of ultimate happiness and pride. Sometimes
the excitement of the moment may cause you to miss out on some important checks that you
must make prior to possession.
To help you make sure that taking possession of your new home is as smooth and hassle-free as
possible, we have put down a ready checklist with all the points you should check before you
take final possession of your new home.
1. Documents:
This is by far the most important of all checks as the set of documents is what will help you
verify ownership and legality of construction in future, whenever the need arises. Here is the list
of documents you must ensure you have received from the builder prior to/at the time of
possession:
a)

Approved Plan Layouts

After studying the plan layout submitted by builder and architect, the licensing authority issues
the approval for the same.
b)

Building Completion Certificate (BCC)

Once the project consultant audits the entire project and submits the report, the licensing
authority issues the BCC (Building Completion Certificate)
c)

Occupation Certificate

This is the final certificate issued by the licensing authority and only after the issue of this
Occupation Certificate, water connection is provided to the newly built home. It is also
important to be able to sell or transfer your home to another person.
d)

Original registration deed and other documents

Original registration documents, parental documents, drawings, concerned authority approvals

and other similar documents are generally submitted to the association. It Is advisable to get a
copy of these and a complete breakup of the common area as well.

2. Interiors:
a)

Doors & Windows

Air circulation is very important to lead a hale and hearty life in your dream home. For proper air
circulation and sunlight, the doors and windows are to be placed properly especially in the
kitchen and bathrooms and too much sunlight can have its negative effects as well. Sliding doors,
if any, are to be checked and any defects should be brought to the builders notice. It is also

important to check that your main door is fitted with a door eye/magic eye as this is one of the
most basic features that a home must have.
b)

Walls & Ceilings

Some builders might leave your wall with a single coat of paint which may cause it to lose its
shine within a very short period. It is better to check all the walls for a double coat. The balcony
grills and gates are also to be checked for a proper finish. It would also be prudent to check for
loose patches in the wall and look for fan hooks in the ceiling.
c)

Floor & Tiling

Flooring and tiles would need to be checked for cracks and cleanliness. The slope of the tiles
would need to be checked in the toilet, kitchen and balcony to ensure smooth water drainage. In
the kitchen, the finishing/polishing of the counter and any leakage in the same should be
checked as well.
d)

Switches &AC Ducts

Placement of switches and proper electrical connection to all switches would need to be checked.
If any non-functional plug points or switches are found, they should be brought to the builders
notice. Another thing to check for would be AC ducting bad ducting can cause seepage in the
wall as well.
e)

Plumbing & Sanitation

Check the pressure of water from the taps to ensure it is at optimum level. Also, check the
functioning of hot and cold water mixture knobs in the taps. Sanitary fittings are to be checked
for cracks and ensure that the drainage system is in order.
f)

Miniature Circuit Breaker (MCB)

When there is an overload/short-circuit in your homes electrical circuit, an MCB is the one that
saves you from a possible overload/short-circuit. Hence it is of prime importance to check its
functionality and that the MCB with the right range that is appropriate for your home has been
fitted.
3. Amenities:
A lot of amenities are usually promised at the pre-construction stages and it is vital to check
whether all these are in place as mentioned. Also look for the specifications of the facilities
offered and it is good to ensure that there is no deviation from what was stated earlier.
4. Other Safety Precautions:
The guidelines and safety measures specified by the Government are to be followed by the
builder. The piped gas lines, if fitted, that enter your kitchen are to be monitored for proper
functioning. Any promised security measures such as CCTV cameras or intercom must also be
tested for functionality.

Once all the above checks have been satisfactorily made, you should ensure that you have
received the possession letter and the other documents that are to be received from the builder
as per point number 1 above. We hope this checklist will help simplify the process and make
your life easier as you take possession of your new home so you can focus on enjoying the
moment and celebrating with your family and friends.

Help-guide to a perfect Home Loan Application

Buying a home today involves a lot of processes especially if one is applying for a home loan.
Given the current prices of properties, it is difficult for most people to afford to pay the amount
upfront thereby making home loans a much more viable option.
However, applying for a home loan isnt a cake walk as there are a lot of factors that need to be
taken into consideration for a lender/bank to approve ones home loan application. Even the
simplest imperfection in the application can lead to rejection.
Here are a few factors that play a crucial role in the rejection of ones home loan and which you
should pay close attention to, to ensure your application sails through smoothly.
1. Maintain a good CIBIL score
Every person who has previously taken a loan or used a credit card has a CIBIL (Credit
Information Bureau of India Ltd.) score. Banks check this score to decide whether or not a
particular applicant is eligible for a home loan and is one of the most crucial deciding factors.
There are several reasons why one might have a bad CIBIL score. Some of the reasons include

Not paying/late payment of outstanding dues.

Accounts going delinquent owing to delayed/no payment of EMIs.

Non-payment of penalties.

To ensure a healthy credit score, it is important one ensures timely payment of dues and avoid
taking too many unsecure loans. For the ones who already have a bad credit score it is pertinent
he or she works towards improving it and then think about applying for a home loan.
2. Ensure Job Stability
For any lender, the utmost priority is the repayment of the loan. To satisfy this priority the lender
will look at the repayment capability of the applicant. For salaried applicants the bank or the
lender will look at the steady flow of income or in other words job stability. Most home loan
repayment is normally sanctioned for 15-20 years making income stability for the future an
important criterion.
Also if you are planning to take a home loan in the near future it is advised that one does not
change jobs even though it might give a higher income level. Changing jobs is considered to
create a negative impression to the lender.
3. Know the Salary vs EMI thumb rule
The thumb rule for applying for home loans is to ensure that the monthly EMIs are somewhere
around 30 35% of your monthly take home pay. This means that if a persons monthly take
home is around 1 lakh then the monthly EMIs shouldnt exceed Rs. 35,000. Banks normally take
this as a benchmark to approve the loan. Hence it is important to know this and not over apply.
4. Verify property details
Home loan lenders approve loans based on the location of the property. If the locality has had a
history where projects have suffered lack of clearance, acquisitions disputes etc. then the lender
might reject the application. Hence proper analysis of a property before applying for a loan is
sensible.
Also the property must have a proper marketable title and approval. In case of any discrepancies
the lender in most cases will keep sanction letter valid till the applicant is able to find another
property satisfying the title and approval norms.
5. Know the age limit
Age is undoubtedly one of the most important factors for evaluation of a home loan application.
In most cases the minimum age bracket is 23-24 and the maximum age is around 60 for
applicants. It is important to ensure that this criterion is satisfied before applying a loan as the
probability of turning down the application is very high otherwise.
6. Verification of personal profile

It is important that the application has all the right personal details without any inconsistency.
The credit report has all the personal details of the applicant and the lender/bank will go through
these details on the lookout for any mismatch.
In case of a change in details it is important to update the lender with the same. One can avail a
credit report for a nominal fee and cross check the details entered to ensure that the loan
application is not rejected.
All these points are crucial in the approval of a home loan and it is prudent to ensure that they
are followed properly to avoid a rejection.

Real Estate Glossary

There are many abbreviations used in real estate industry. Heres our comprehensive real estate
glossary to help you understand the real estate jargons well.
A
Absorption
The number of months it would take to sell the currently listed homes in the market. The
amount of inventory or units of a specific commercial property type that become occupied
during a specified time period (usually a year) in a given market, typically reported as the
absorption rate.
Acquisition Fee
A fee charged by a lessor to cover the expenses incurred in arranging a lease. Acquisition fees
may also refer to charges and commissions paid for the acquisition or purchase of property, such
as closing costs, real estate commission, and development/construction fees. Acquisition fees
may be paid up front by the buyer or lessee or added to the loan amount and paid over the term
of the loan.

Adangal
An Adangal is an extract from A register which is maintained at the VAO office. This record
gives detailed information on the type of land and the use of this land.
Add-On Factor
The number of usable square feet divided by the number of rentable square feet in a commercial
real estate lease. The result of this calculation will be 1 if the two numbers are identical, but it is
usually slightly lower than 1 because some square footage in a building will be partly or totally
non-unusable. Non-usable square footage includes space shared with other tenants (such as
lobbies, hallways, stairwells, elevators and restrooms) or occupied by structural components
(such as support poles and interior walls). In a poorly designed building, the usable area may be
considerably less than the rentable area.
Alienation Clause
A clause in a contract that gives the lender specific rights in the event that the mortgaged
property is sold or transferred
Amortization
Amortization is the periodic payment of principal and interest on a liability (including a
mortgage), or the write-off of a non-depreciable asset over a scheduled term.
B
Balloon payment
The final payment of the balance due on a partially amortized loan.
Base rent
The minimum rent due to the landlord. Typically, it is a fixed amount. This is a face, quoted,
contract amount of periodic rent. The annual base rate is the amount upon which escalations are
calculated.
Board Approval
Board approval is a condition in the standard cooperative sales contract requiring that the buyer
obtain approval from the board of directors of the cooperative corporation as a prerequisite to
completing the sale.
Breakpoint
The sales threshold over which percentage rent is due. It is calculated by dividing the annual base
rent by the negotiated percentage applied to the tenants gross sales.
Bridge Loan
A bridge loan is a loan for a short duration of time and can be used when one is purchasing one
property but is dependent on the equity from another property that has not yet been sold. Once
the property is sold then the bridge loan is repaid.
Broker
An individual or firm that charges a fee or commission for executing buy and sell orders
submitted by an investor. The role of a firm when it acts as an agent for a customer and charges
the customer a commission for its services.
Bond
A sum of money paid by a tenant and held by the Tenancy Services to ensure against defaulting
on payment and damage to the property.
C
CAM cap

The maximum amount for which the tenant pays its share of common area maintenance costs.
The owner pays for any CAM expenses exceeding that amount
Cash flow
The net cash received in any period, taking into account net operating income, debt service,
capital expenses, loan proceeds, sale revenues, and any other sources and uses of cash.
Chitta
A Chitta is an extract from Patta that contains information related to the ownership details of the
land. Information like Village Taluk, District, Patta number, Owners name and their fathers
name can be found in this record.
Closing Costs
Closing costs are the expenses incurred in the purchase and sale of real property paid at the time
of settlement or closing. Some examples of closing costs are title insurance, attorney fees,
appraisal fees, recording fees and taxes.
Cost approach
A method of determining the market value of a property by evaluating the costs of creating a
property exactly like the subject.
Common Area Maintenance
This is the amount of additional rent charged to the tenant to maintain the common areas of the
property shared by tenants. Typical examples include such work as landscaping, snow removal,
exterior lighting, as well as insurance and property tax.
Comparative advantage
The principle that cities or regions tend to produce those items or support those activities for
which they have the greatest advantage over other areas as defined by the factors of production,
demand, supporting industries, and quality of life considerations, as defined in relation to human,
financial, and physical resources, and opportunity costscosts expressed in terms of
opportunities foregone.
Condotel
A condominium project that is operated as a hotel with a registration desk, cleaning service and
more. The units are individually owned. Unit owners also have the option to place their unit in
the hotels rental program where it is rented out like any other hotel room.
Conformity
Conformity is the homogeneous uses of land within a given area which results in maximizing
land value.
Contract
A contract is a legally binding agreement between two parties, and in order to have a valid
Contract of Sale in real estate there must be: an offer, an acceptance, competent parties,
consideration, legal purpose, written documentation, description of the property, and signatures
of the principals.
Conveyance
The act of transferring an ownership interest in real property from one party to another.
Conveyance also refers to the written instrument, such as a deed or lease that transfers legal title
of a property from the seller to the buyer. The term arises most frequently in real estate, where a
conveyance refers to the written contract between the seller and the buyer stating the agreedupon purchase price and the date of actual transfer, as well as the obligations and responsibilities
of both parties.
Cooperative

A type of ownership of property. This is when the individual unit owners own shares in the
cooperative building and do not own the actual property. The amount of shares owned is
determined by the value and size of the apartment. The cooperative building owns all of the
units and the purchaser is buying stock in the building.
Credit Score
A credit score is a numerical rating provided on a credit report that establishes creditworthiness
based upon a persons past credit/payment history and their current credit standing
D
Declaration
Declaration is the master deed containing legal description of the condominium facility, a plat of
the property, plans and specifications for the building and units, a description of the common
areas, and the degree of ownership in the common areas available to each owner.
Discount rate
The percentage rate at which money or cash flows are discounted. The discount rate reflects
both the market risk-free rate of interest and a risk premium. Also see opportunity cost.
Dual Occupancy
A block of land which is zoned so that there two distinct dwellings are permitted by the Local
Territorial Authority, to be constructed.
Dual Agent
A dual agent is a broker or salesperson who represents both the buyer and seller in the same
transaction.
Dynamic system
A complex and ever-changing or evolving set of diverse and interrelated entities and agents
which are organized into a coherent and working totality which serves multiple and/or common
purposes or objectives. Also see system and market dynamics.
E
Economic Depreciation
Economic depreciation is the physical deterioration of property caused by normal use, damage
caused by natural or other hazards, and failure to adequately maintain property.
Escrow
A state where consideration, benefits, legal rights, money, documents or other valuables are
transferred to another party in advance of that partys legal claim to them, on the basis that the
legal claim will arise at a given point in the future. It is a form of trust.
Efficiency
A measure of the capacity or effectiveness of space to produce the desired results with a
minimum expenditure of time, money, energy, and materials.
Escalation Clause
A clause in a lease which allows the landlord to increase the rent in the future to reflect changes
in expenses paid by the landlord, such as real estate taxes, operating costs, etc. This can take
three forms: 1) fixed periodic increases, 2) adjustments based on the Consumer Price Index
(cost-of-living increases), and/or 3) an increase tied to the increased costs of operating the
property.
Estate

Estate refers to the collection of all assets of a deceased person. It is also the extent of interest a
person has in real property.
Eviction
An eviction is a landlords action that interferes with the tenants use or possession of the
property. Eviction may be actual or constructive.
Exclusive Agency Agreement (Exclusive Listing)
An exclusive agency agreement is between a broker and a seller designating the broker as the
sellers sole agent for the purpose of selling his or her property. This agreement does not
preclude the owner from effectuating a sale on his own.
Expansion
A phase of the real estate or business cycle characterized by the dramatic short-term increase in
the supply of available units in a given market (due to economic growth and increasing
construction activity) as a response to increasing and/or pent-up demand and rising price levels.
Expenditure patterns
The tendencies or propensities of individuals/households to spend disposable income on a given
good or service in comparison to other goods and services (typically defined as a percentage of
disposable income) in relation to income level or range and/or other demographic or socioeconomic characteristics.
F
Fair Market Value
The fair market value is the price for a property agreed upon between a buyer and seller in a
competitive market.
Fixed Lease
A fixed lease is when the rental amount remains the same for the entire lease term; also called
flat, straight or gross lease.
Flip Tax
A levy issued on the transfer of ownership by a cooperative corporation or condominium
association against the seller, typically, though it may be against the buyer.. The flip tax is usually
a percentage of the purchase price.
Full Recourse Debt
A guarantee that no matter what happens, the borrower will repay the debt. Typically with a full
recourse loan no occurrence, such as loss of job or sickness, can get the borrower out of the
debt obligation. In this situation, if there is no collateral for the loan, the lender can go after the
borrowers personal assets to collect if the loan is defaulted.
Functional feasibility
Considerations made in the site selection process which assist in the evaluation of site potential
as defined in terms of the practicality of a site, the best site for a given use, or the determination
of a sites best use, through the examination of linkages, competition, demographics, and market
conditions.
Functional obsolescence
A form or source of accrued depreciation considered in the cost approach to market value. The
reduced capacity of a property or improvements to perform their intended functions due to new
technology, poor design, or changes in market standards.
G

Gap analysis
An evaluation of the difference in the demand and supply of space (measured in terms of square
footage) for a particular type of commercial property in a given market area where gaps are
expressed as the amount of square footage demanded less the amount of square footage
available in a given time period. Note that if demand exceeds supply, the gap will be positive. A
positive gap indicates that potential opportunities exist for successful commercial real estate
transactions. However, transactions might be avoided when supply exceeds demand (or when a
negative gap occurs), as there is an oversupply of available space in the market.
General Agent
A general agent refers to the entity that has full authority over a property of the principal, such as
a property manager.
Graduated Lease
A graduated lease is a lease in which the rent changes from period to period over the lease term.
This type of lease is usually used by a new business tenant whose income will increase over time.
Gross area
The entire floor area of a building or the total square footage of a floor. Gross leasable area
(GLA) The total floor area designed for tenant occupancy and exclusive use, including
basements, mezzanines, and upper floors, and it is measured from the center line of joint
partitions and from outside wall faces. GLA is that area on which tenants pay rent; it is the area
that produces income.
Gross Lease
A type of lease in which the tenant pays a flat sum for rent, covering all landlord-paid expenses,
including taxes, insurance, maintenance, utilities, etc. By having all these costs thrown in, you can
better forecast your monthly expenses and also avoid potentially high bills associated with these
operating costs.
Growth patterns
In reference to the patterns of urban or population growth in a geographic market, an important
consideration in retail trade area analyses as growth patterns are known to affect sales/revenue
potential within a market given the tendency of retail to follow population movement and
income concentrations over time.
H
Heatmap
A visual representation of data using colors. A heatmap can be used with all sorts of data, from
representing the number of foreclosures to the spreads of credit default swaps.
Housing Expense Ratio
The housing expense ratio is the relationship of a borrowers monthly payment obligation on
housing (principal, interest, taxes, insurances and other applicable housing expenses) divided by
gross monthly income, expressed as a percentage. It is also referred to as top ratio.
Housing demand
The total number of housing units demanded in a given market, defined as occupied household
units divided by one minus the vacancy allowance for that market (where demand is affected by
the rate at which new households are being added to the market, allowing for a normal level of
vacancy).
HVAC
HVAC is an acronym that stands for heating, ventilation and air conditioning.

I
Imperfect market
A market in which product differentiation exists, there is a lack of important product
information, and certain buyers or sellers may influence the market. Commercial real estate is
bought and sold in an imperfect market.
Index
Index is a benchmark, usually a published interest rate, such as a one-year London Interbank
Offered Rate (LIBOR) security yields, used to calculate the interest rate of an adjustable rate
mortgage when rate is scheduled to change. Generally, a margin stated in loan documents is
added to the index to determine the new interest rate.
Index lease
A lease in which the rental amount adjusts accordingly to changes and/or movements in a price
index, commonly the consumer price index.
Industrial gap
The difference between the demand for an industrial property and the supply of that property in
a given market or area.
Installment Sale
An installment sale is a property sale in which the purchaser pays the purchase price over a
period of years. The seller recognizes gain for tax purposes by the proportion of the profit
(determined by the profit divided by the nest sales price of the asset) received on each payment
as it is received.
Investment Real Estate
Real estate that generates income or is otherwise intended for investment purposes rather than as
a primary residence. It is common for investors to own multiple pieces of real estate, one of
which serves as a primary residence, while the others are used to generate rental income and
profits through price appreciation. The tax implications for investment real estate are often
different than those for residential real estate.
L
Land Lease
A land lease is a situation in which a building and other land improvement are rented for a term
of years. At the end of the lease term, the right of possession is extinguished and reverts back to
the landowner. At the time, the tenant loses any remaining equity interest in the property.
Landmark
Landmark status is the designation given to a building or neighborhood that is under
government protection for purposes of preservation.
Leasing
A means of obtaining the physical and partial economic use of a property for a specified period
without obtaining an ownership interest.
Letter Of Intent
This is an informal and preliminary agreement between the tenant and the landlord indicating
intent to move forward with negotiations. Always consult your legal counsel before signing any
Letter of Intent.
Listing
The term used by brokers to market an apartment for sale or rent.

Listing Broker
The listing broker represents the interests of the seller or landlord in the sale or rental of his or
her property.
Loan balance
The amount of money remaining to be paid on an amortizing loan at a given time.
Loan or mortgage value
That portion of the value of real property recognized by the lender when used to secure a loan.
Loft
A loft refers to an open living space that was converted from commercial space to residential
space. Lofts contain very high ceilings, large windows and open space.
Lot
A lot is a measured section of land.
M
Maintenance
The monthly charge levied on owners by a cooperative corporation to cover the buildings
operating costs, real estate taxes, and the debt service on the buildings underlying mortgage.
Market analysis
The process of examining market supply and demand conditions, demographic characteristics,
and opportunities; identifying alternative locations/sites that meet specific objectives or satisfy
various criteria; and assessing the financial feasibility of those locations/sites to facilitate decision
making regarding the commercial potential or suitability of various locations/sites to support a
given activity or use.
Match
Second stage of four-stage transaction management process pertaining to gathering and
evaluating property information to unite the investor and user. The acronym MATCH represents
the activities to market, analyze, target, compare, and highlight during the match stage.
Mean
A measure of central tendency (for a distribution of values) defined as the average value of a
variable in a sample and calculated by adding together all the values observed in a data set and
dividing by the number of values observed.
Mortgage
A mortgage is a pledge of real estate collateral to secure a debt. Also, it is a legal document
describing and defining the pledge. The mortgage may also include the terms of repayment of
the debt. It is also referred to as a deed of trust.
Mortgage Broker
A real estate professional who represents an array of banks seeking to issue mortgages. The
mortgage broker meets with a customer, assists with the application, and facilitates the mortgage
process on behalf of the borrower and the bank. Generally, in the case of residential mortgages,
the mortgage broker is paid a fee by the bank for this service.
Mortgage Insurance
Mortgage insurance is insurance that protects the lender in case the home buyer does not make
their mortgage payments. Typically, a borrower would be required to pay a fee for mortgage
insurance if their down payment is less than 20%.
N

Net lease
A lease in which the tenant pays, in addition to rent, all operating expenses such as real estate
taxes, insurance premiums, and maintenance costs.
Non-Compete Clause
This clause prevents the landlord from leasing any other premises on the development to a direct
competitor of yours or another tenant operating the same type of business. It might be worth
considering such a clause to protect your investment for the long term especially if you are in
the service industry and expect a lot of walk-in traffic.
Notarize
Some legal documents, including certain leases and contracts of sale, are notarized by a certified
Notary Public to verify the authenticity of a signature.
Neutral leverage
An investment situation in which the cost of borrowed funds is exactly equal to the yield
provided by the investment.
O
Obsolescence
In reference to the inadequacy, disuse, outdated, or nonfunctionality of facilities, infrastructure,
products, or production technologies due to effects of time, changing market conditions, or
decay (a factor considered in depreciation to cover the decline in value of fixed assets due to the
invention and adoption of new production technologies, or changing consumer demand).
Open Listing
An open listing is an apartment for sale for which the owner has not signed an exclusive
agreement with a real estate broker. Many brokers may represent the seller, or the seller can
promote the property independently.
Operating expenses
Cash outlays necessary to operate and maintain a property. Examples of operating expenses
include real estate taxes, property insurance, property management and maintenance expenses,
utilities, and legal or accounting expenses. Operating expenses do not include capital
expenditures, debt service, or cost recovery.
Outgoings
Costs incurred by the owner of an interest in property, usually calculated on a yearly basis. Eg.
management, repairs, rates, insurance and rent payable to the holder of a superior interest, as
appropriate to his contractual or other liabilities. It is prudent to make annual provision for
future items involving expenditure at intervals of more than one year.
Oversupply
In reference to commercial real estate, oversupply is a stock or supply of a given commercial
property type that is greater than that which can be cleared under prevailing prices levels and
market conditions (for example, excess supply). Also, a phase of the real estate market cycle
denoting that period of time in which commercial real estate markets become saturated with
units due to overbuilding.
P
Partially amortized mortgage loan
The payments do not repay the loan over its term and thus a lump sum (balloon) is required to
repay the loan. Participation mortgage A loan secured by real property, with a stated interest rate

that also provides for a share to the lender in annual net cash flow, gain on sale, or proceeds
from refinancing the property. (Real Estate Information Standards)
Passive Loss
A passive loss is a loss generated by investment real estate when real estate is not the taxpayers
primary business. Loss in excess of income may not be fully recognized for tax purposes in the
year it was incurred.
Patta
A Patta is an important legal document issued by the government in the name of the owner of a
particular land or plot. This land revenue record establishes the ownership or possession of the
property.
Penthouse
A penthouse apartment refers to the apartment on the highest floor in a luxury, high-rise
building.
Percentage Lease
A percentage lease refers to a lease that has a rental amount that is a combination of a fixed
amount plus a percentage of the lessees gross sales.
Perfecting a Loan
When a loan is issued against a personal property, it is recorded in the county clerks office
against the name of the borrower. The recording process perfects a security position against the
collateral.
Positive leverage
Borrowed funds are invested at a rate of return higher than the cost of the funds to the
borrower.
Principal
The portion of a loan payment used toward reducing the original loan amount.
Proprietary Lease
The lease issued by a cooperative corporation to each tenant-shareholder prescribing his or her
right to occupy a specific apartment and his or her general obligations as an owner and tenant.
Q
Quadruplex
A quadruplex is an apartment with four levels.
Qualify
First stage of four-stage transaction management process pertaining to the process of gathering
and evaluating information to measure a clients readiness, willingness, and ability to
consummate a transaction. The acronym QUALIFY represents the considerations of quantify,
usage, authority, latitude, intention, financial, and yield involved in the qualify stage.
R
Rate Cap
A rate cap is the limit on interest rates during the term of an adjustable rate mortgage.
Real Estate Broker
State-licensed agents with expertise in the leasing process. A good broker will not only help you
find a space, but also help you in all aspects of the lease transaction. Because most brokers
receive a commission or fee from the landlord or seller they represent (via a representation

agreement), its worth doing your research to find a good one; a real estate lawyer can often offer
advice in this regard.
Real estate investment trust (REIT)
An investment vehicle in which investors purchase certificates of ownership in the trust, which
in turn invests the money in real property and then distributes any profits to the investors. The
trust is not subject to corporate income tax as long as it complies with the tax requirements for a
REIT.
Real estate trends
Long-term movements or tendencies in the demand for commercial real estate (which can
typically last for years or decades), usually tied to macro-economic or business cycles.
Recession
A period of reduced economic activity or a general economic downturn marked by a decline in
employment, production, sales, profits, and weak economic growth that is not as severe or
prolonged as a depression. As a result, sales in real estate markets are slow, property values and
price levels are flat or decreasing, and there is virtually no construction of new stock given excess
supply of units in most real estate markets.
Referral Fee
A referral fee is a percentage of a brokers commission paid to another broker for the referral of
a buyer or seller.
S
Sales Comparison Approach
The sales comparison approach is an appraisal tool for estimating the value of a property with
other similar properties that have sold recently.
Sales comparison value
An estimate of value derived by comparing the property being appraised to similar properties
that have been sold recently, applying appropriate units of comparison, and making adjustments
to the sales prices of the comparable based on the elements of comparison.
Security Deposit
A payment required by a landlord to guarantee that the tenant meets his or her obligations under
the lease and to guard against any potential damages that may be incurred during the term of the
lease.
Step-up lease
A lease in which the rental amount paid by the lessee increases by a preset rate or set dollar
amount at predetermined intervals. A step lease is a means for the lessor to hedge against
inflation and future maintenance or operational expenses.
Street-based mapping
Relatively easy-to-use GIS applications that allow the user to map objects such as commercial
properties or retail establishments by street address.
Suspended losses
Passive losses that cannot be used in the current year are suspended for use in future years or at
the time of sale.
T
Tax Abatement

A tax abatement is a financial incentive offered by a local or municipal government to stimulate

development in a particular area. The owner of the property and/or the developer has reduced
taxes for a specific period of time, typically 10-15 years. The taxes are raised incrementally to the
full tax burden over the period of a few years.
Tax savings (capital expenditure)
Entry on the tenants Cash Flow Form. It refers to any tax savings associated with any capital
expenditure by the tenant in terms of the site or major, unusual business expenses incurred to
make the new office efficient for the business. The amount of tax savings is calculated by
multiplying the annual deduction amount by the tenants tax rate.
Tenant Improvements
Defines any improvements to the leased space either by, or for, a tenant. If you expect to make
lots of improvements to the space, its worth negotiating these with your landlord and trying to
get as much of these costs covered as you can. The Tenant Improvement (TI) Allowance or
Work Letter defines the fixed amount that the landlord will contribute towards these
improvements, and costs over this amount are then covered by the tenant (also known as the
Tenant Finish Allowance).
Time value of money (TVM)
An economic principle recognizing that a dollar today has greater value than a dollar in the
future because of its earning power.
Title
The legal term for the evidence that the owner is in lawful possession of the land and property.
Total Existing Inventory
In reference to commercial real state, it is existing and currently available supply or stock as
represented by the total number of units or total amount of space available of a specific
commercial property type in a given market at a particular point in time.
U
Unsold Shares
Shares of stock in a cooperative corporation transferred to the sponsor at the completion of the
conversion process. The sponsor normally gets special rights to rent and/or sell these shares
(representing special apartments) without board approval.
Urban System (city as a system)
A complex and structured urban environment or system composed of highly diverse, interacting,
and interdependent parts and activities aggregated or organized in such a way as to serve a
common purpose and/or satisfy the needs and wants of people residing in and dependent upon
that system.
Useable Area
Rentable area, less certain common areas that are shared by all tenants of the office building
(such as corridors, storage facilities, and bathrooms). Also defined in office buildings as the area
that is available for the exclusive use of the tenant. Useable area = rentable area building
efficiency percentage.
V
Vacancy Rate
The vacancy rate is the projected rate of the percentage of rental units that will be vacant in a
given year.

Valuation
Valuation establishes an opinion of value utilizing an objective approach based on facts related
to the property, such as age, square footage, location, cost to replace, etc.
Vesting Options
Vesting options are choices buyers have in how to acquire property.
W
Walk Through Inspection
The inspection of a property immediately before the closing to ensure that the property does not
have any new damages.
Wage Assignment
The procedure of taking money directly from an employees compensation under the authority
of a court order, in order to pay a debt obligation. Wage assignments are typically a last resort of
a lender to receive repayment from a borrower who has previously failed to pay their debt
obligation.
Wetlands
Wetlands are federal and state protected transition areas between uplands and aquatic habitats
that provide flood and storm water control, surface and groundwater protection, erosion control,
and pollution treatment.
Words of Conveyance
Words of conveyance is a stipulation in a deed demonstrating the definite intent to convey a
specific title to real property to a named grantee.
Wraparound Mortgage
A wraparound mortgage is a junior mortgage in an amount exceeding a first mortgage against the
property.
Y
Yield
The yield refers to the return on an investment.
Z
Zone
An area of a municipality or specific building that is zoned for a specific use, such as residential,
commercial, etc.
Zoning
Zoning are the laws regulating land use.
Zoning Ordinance
Zoning ordinance is a statement settling forth the type of use permitted under each zoning
classification and specific requirements.