A partial occupancy certificate (POC) is an important document for a property being sold. What exactly is a POC, and what does it entail? How does it differ from an occupancy certificate? Continue reading for a complete overview.
Investing in a property that is currently under construction is a wise decision. The same property is available at a lower price than it will be sold for once construction is completed. Furthermore, it allows you to enjoy the luxury of living in a brand-new home that was custom-built just for you. However, before investing in such a property, it is critical to understand certain technical, legal, financial, and civic aspects to ensure that the construction is legitimate and in accordance with all municipal laws and regulations.
What Partial Occupancy Certificate Means
Buyers cannot occupy a property until the project receives an Occupancy Certificate (OC). Large construction projects that are carried out in stages have the option of obtaining a Partial Occupancy Certificate for completed portions. For example, if a project consists of five buildings, the builder can apply for a partial occupancy certificate once the first building is completed.
Similarly, once the other three buildings are completed, a partial occupancy certificate can be applied. The builder can apply for an Occupancy Certificate (OC) after completing the fifth building, which marks the end of the project.
Conditions of Partial Occupancy Certificate
A partial occupancy certificate is issued when only a portion of a large construction is completed and ready for occupancy. However, there are certain requirements that a construction must meet in order to obtain a partial occupancy certificate. The parameters are as follows:
Lift services should be completed and functional.
Electrical Inspectorate certificates should have been issued.
Facilities for waste management and composting should have been maintained.
Rainwater harvesting facilities should function.
The fire department’s approval is mandatory.
Appropriate arrangements for wastewater treatment must be made.
Parking is only allowed on the ground and first-floor levels.
Validity of Partial Occupancy Certificate
A partial occupancy certificate is valid only until the authorities issue an occupancy certificate at the end of the entire project. Because the partial occupancy certificate allows occupancy of habitable parts of the project, it is only a temporary solution. This arrangement, however, benefits both the builder and the buyer, as buyers would otherwise have to wait years to occupy the property they have invested in. A builder can also expect more buyers for the remainder of his project if a portion of it is already occupied.
What to Know When Investing in a Property with a Partial Occupancy Certificate
While there are benefits to investing in an under-construction property, there are also risks that should be considered. Because an under-construction property can only be issued a partial occupancy certificate rather than an occupancy certificate, there is no guarantee that an occupancy certificate will be issued upon project completion. The authorities only issue an occupancy certificate if the construction complies with all applicable regulations and norms. Thus, a partial occupancy certificate does not guarantee an occupancy certificate. Some important factors to keep in mind when it comes to partial occupancy certificates are:
Home loan – Not all banks will give you a home loan for a property with only a partial occupancy certificate. Unless your builder has a relationship with a specific bank, obtaining a loan for a POC property can be difficult.
Documents of ownership – Authorities generally issue documents proving ownership of a property only if it has an occupancy certificate. There are many documents that do not come with a partial occupancy certificate.
Tracking the progress of the project – Buyers who have invested in or are residing in a property with a partial occupancy certificate should monitor the project’s progress. As soon as the project is completed, the builder must apply for an occupancy certificate, which is the final document required to take full possession of your property.
Conditions of possession – In some cases, builders insist that buyers take possession of their uninhabitable properties. To live in a property with a partial occupancy certificate, certain criteria must be met. If a buyer discovers that the conditions have not been met, they may contact the real estate regulatory authority in their state.
Summing Up the Partial Occupancy Certificate
Since multi-tower buildings became popular, builders have been completing their construction projects in stages. The option of issuing a partial occupancy certificate is especially useful in this regard, as it benefits both buyers and builders. While a buyer of Tower I would have had to wait for Tower V to be completed, they can now take possession of their Tower I home as soon as it is completed and deemed habitable by the authorities via a partial occupancy certificate. The builder, on the other hand, benefits from increased and faster sales on existing projects.
However, it is important to note that a partial occupancy certificate is not the final legal document required to prove possession of a property. It is actually a temporary certificate issued until the entire project is completed and an occupancy certificate can be issued on the property.
