Getting one’s own house is a dream of every middle-class person. No doubt, it is the biggest investment of their life. They have various concerns to minimize the risk of any kind of scam. Same are the concerns of the investors who want to step into the real estate market. Although the market of real estate agents has been established, yet the dark side is also active to trap them in their frauds. For a common man as well as a real estate agent, it is a basic headache to make sure that the property is legally authentic and genuine. So, it is a big question that how to check if a housing society is fake or not.
Illegal Housing Societies
According to the statistics issued by Lahore Development Authority, there are over 90 illegal housing schemes in Lahore Division. And same is happening in other major cities like Islamabad and Karachi too. The customers are often deceived and they become the target of these scams. If you have enough knowledge of how to check the authenticity of a housing scheme, you can save yourself from becoming vulnerable to the frauds in the market.
Let’s go through some of the key measures that customers may use to prevent frauds.
Approval from Relevant Authorities
If you want to purchase a property in Pakistan, you firstly need to check the legal status and verification of that housing society in the legal authorities. For example; if you want to own a property in Lahore, you can check the approval of that housing scheme in the list of approved housing societies issued by LDA (Lahore Development Authority), TEPA (Traffic Engineering & Transport Planning Agency) and WASA (Water and Sanitation Agency).
Similarly, if you want to own lands in Islamabad, Gujranwala, Rawalpindi or Multan, you can check the approval status of particular housing societies on the official websites of CDA, GDA, RDA or MDA respectively. For this purpose, you can visit their websites on mobile phone or visit their offices physically as well. It is the most important strategy, if you want to keep your investment secure. Your land will get the supply of domestic facilities (water, electricity, natural gas, sewerage, etc.) only if the housing society is approved by all the regulatory authorities. These authorities have issued the lists of dozens of housing societies which are not regulated by government.
Total Land Provision
Another important step in the verification of the land status, you should confirm the total land provision by the housing society. In simple words, if the housing society does have the land on actual grounds they claim on documentation, it means they are fair in their words. Some fake housing societies trap customers by showing them wrong figures on paper.
You can also ask them to show you the official documentation of land provision certificates. The regional development authorities issue NOCs to the housing societies. You can ask these societies to show the NOCs issued to them. If they hesitate in showing you the documentation, you must be aware of any fraud.
Some housing schemes manipulate the customers by presenting the fake images of the society. They have no sewerage system or carpeted roads, but they present their society as a well-developed society. They maybe a fraud if they have not the actual progress on ground as they are claiming in their commercials. You should definitely visit the spot by yourself and check if the development shown in the advertisements and banners is realistic or not.
Another significant stage is to check the repute of the owner of housing society in the market. You must verify the track record and market standing of the developers. You should also have an overview of their earlier projects and their authenticity.
You can also consult the other market experts or investors who may give you an idea about the housing society. You can also verify the track record of the developer from the investigative agencies like, FIA.
Some housing societies transfer the direct ownership of the plot to the customer. In direct ownership, there is a written commitment made to a specific property investor of a plot of land with a specific area size in a planned or existing housing society or scheme. This transfer system of land is considered very reliable and authentic.
But yet, a number of housing societies still deal in plot file system. Plot file system is like a written commitment to a customer of a plot of land with a specific area size in a developed housing project. It is not acknowledged or approved by the regional development authority. However, we can see practically the most of the housing projects use this plot file transfer method.
Obviously, you should prefer if a housing scheme is dealing in direct plot transfer. It is a safe method for investment. But if you want to opt for file transfer system, you should first verify how genuine file transfer system they have. Because most of the file transfer system is not regulated by any regional authority, you need to keep yourself secure as much as you can.
Reliable Property Dealer
Last but not the least, you can also consult a credible real estate agent who can help you in purchasing a property in an approved and developed housing scheme. No doubt, there are a lot of scammers and frauds in the market who aim just to grab the money in your hands. Yet, if you find any person genuinely having the knowledge of this market, they can surely guide you in the whole procedure.
With the growing need of new housing projects, the number of housing societies in the market is also increasing. However, all of them do not meet the legal requirements and a lot of them are illegal and are not regularized by government. General public become the targets of scammers in the name of ‘affordable housing schemes.’ But having an overall understanding of the requirements of a housing scheme, you can save yourself from falling into the trap of the fake housing projects.