Why is UDS important when buying or selling an apartment ?

| Share
# FAQ:Why is UDS important when buying or selling an apartment ?
The apartment which is bought/sold has two major cost components.

One component is based on the cost of construction. That is the cost of the raw materials (cement, sand, bricks, wood, steel, tiles, electrical fitting, piping, flooring tiles, paint, etc.,) and the labour used for construction. This value should usually remain the same for the same quality of constructions, within a city.

For example, assuming the cost of construction is Rs.1000 / sqft**, for a 900 sqft apartment, the cost of construction would be Rs.9 Lakhs.

As the apartment ages, this building component depreciates in value.

The second component of the value of the deal will usually be tied to the UDS of the apartment and the market value of the UDS at the time of the deal.

Assuming a four-in-one apartment of equal sizes on one ground (2400 sqft) of land. The UDS will be 600 sqft. (See :
How is UDS calculated ? [placetolive.in])

If the ground was at a prime residential location in the city, where a plot of land costs, say 2 Crores, then the value associated with the UDS will be Rs.50 lakhs, which makes the total value of the apartment as Rs.59 lakhs.

If the ground was in the suburbs and costs, say Rs.20 lakhs, then the value associated with the UDS will be Rs.5 lakhs, which makes the total value of the apartment as Rs.14 lakhs.

As the apartment ages, while the building component depreciates in value, the UDS component appreciates in value.

So, more the UDS component, better the deal.

Note :
**Rs.1000/sqft is the approximate current cost of decent quality construction in Chennai, India as of Feb 2009. This includes profit margin of the building contractor.

Related questions :

What is UDS (Undivided Share) ? [placetolive.in]
How is UDS calculated ? [placetolive.in]

# DEIVI46   FAQ:Why is UDS important when buying or selling an apartment ?Sat Apr 28, 2012 12:29 AM
I purchased a flat in a lay out with 340 flats.Our block consists of 20 equal sized flats built on 6691 sq ft, having G+4 floors. The builder sold the flats as G+4 floors. But he has given only 239 sq ft as UDS. Is it correct? If he has planned for G+6 floors but got approval for only G+4 floors, what shall be my right for UDS on the land on which the block is built?
DEIVASIGAMANI


Login to post

(requires