Apartment hunters often base their decision on the amount of built-up area available and other extra facilities which are attached to the flat. Certain terms like Undivided Share (UDS) may be unfamiliar to first-time property buyers. It is an important aspect one should know when purchasing a property.
In this article, we take a look at what undivided shares or UDS stand for, their importance and all the legal concerns behind it.
In this article let us take a look at what are undivided shares or UDS, what UDS means, what is the importance of undivided shares, and the legal importance of undivided shares.
The Definition of Undivided Share (UDS)
Undivided shares or UDS means a portion of land owned by the buyer of an apartment in a residential complex on which the entire structure is built. Each flat built on that particular land will own a portion of the land, but there will be no defined limits.
In other words, say you own an apartment in a gated community which is spread across 5 acres of land. As per the undivided share of land law, you will co-share the ownership of that 5 acres along with other owners of the community.
Importance Of Undivided Share Of Land (UDS)
Now why is undivided share given so much importance? UDS helps in deciding the selling price f the property.The cost of an apartment is generally divided into two parts:
- the cost of construction
- cost of the land.
The cost of land is the price of the undivided share of land in the building. When the building is renovated or if the government acquires it and demolishes it after some time, the property owners will be compensated based on the undivided share of land (UDS) which is in the name of the owner.
Homebuyers should be aware in real estate, the price of the building always depreciates while the price of the land on which the building stands always appreciates. In case the landowner does not hold an undivided land share, he or she may not be able to sell the property or make a good profit. A smart buyer should always ask about the UDS that comes with the apartment. Here’s how you can identify UDS when you buy a property:
- In the case of a building complex or gated community, the UDS will be mentioned in the sale deed contract.
- In the case of a cooperative society, the land is owned by the society which they allot to each property owner in the form of shares.
What’s The Relation Between UDS and Parking Space?
When you purchase a property, you must make sure that the builder has allocated parking space in your name. This could be a valuable commodity for you as it adds to the undivided share of land. When your part of UDS is calculated, the parking space area will be included in the calculation in square feet.share, he or she may not be able to sell the property or make a good profit. A smart buyer should always ask about the UDS that comes with the apartment.
How To Calculate The UDS or Undivided Share ?
A simple formula is used to calculate the undivided share of land. It is calculated by multiplying the total land area by the individual apartment’s size and dividing the result by the total area of all flats in the building.
Formula:
(Individual apartment super built-up area ÷ total super built-up area of all apartments) ✕ total land area
Sample Calculation of Undivided Share (UDS)
If your building has a variety of units, your UDS will be proportionate to the size of your apartment.
Assumption:
You own a 3 BHK apartment in a complex with 200 flats which comprise
- 100 1 BHK flats of 500 square feet
- 50 2 BHK flats of 1,000 square feet
- 50 3 BHK flats of 1500 square feet
The total land area is 40,000 square feet.
Calculation:
The total land area of the society = (100 × 500) + (50 × 1000) + (50 × 1500) = 1,75,000 square feet.
Therefore, the UDS of
- 3 BHK = (1,500/175,000) x 40,000 = 340 sq ft
- 2 BHK = (1,000/175,000) x 40,000 = 228 sq ft
- 1 BHK = (500/175,000) x 40,000 = 114 sq ft
Why Is The UDS Share Calculation Important ?
Below are some of the reasons why the UDS share calculation is important:
- It Is Your Right- The value of your home is largely determined by your undivided piece of land in an apartment complex, it goes without saying that the sale must be clearly stated in the builder-buyers agreement. If your calculations differ from the builders calculation, you have the right to question him about it and get the error corrected.
- Defines Legality Of The Building- The legality of a residential building is also determined by whether UDS meets with the developer’s FSI (floor space index). An examination of your undivided portion of land in such detail would reveal a building’s illegality.
- Criteria To Get Home Loan- If you apply for a home loan, the bank will check for the UDS before approving your application. If you’re buying a resale property, they will look for your housing society’s share certificate, as well as other paperwork, to complete your home loan application.
- Important Document For Property Registration- When you go to the sub registrar’s office to register your property, the officials will inspect your undivided shares certificate.
- The Future Of The Flat Depends On UDS Certificate- In the event of a natural disaster, the owner of the flat will be compensated based on the undivided shares certificate. This is also applicable if the government decides to buy the land and demolish the building for any reason, or even if the building is taken up for renovation.
Closing Thoughts
The undivided share of land is a valuable commodity to the wonder of the property. It decides the worth of the property or the apartment and decided the compensation amount in case of the dismantling of the property. If car parking space is included in the USD, the compensation amount increases. If you want to sell UDS, you may do so under a registered sale deed.
Here are some other points to remember while purchasing a property:
- Make sure there are no separate agreements to register the undivided share of land by checking in with the authorities.
- The UDS should be mentioned in your purchase agreement, if not you can check in with your builder.
- If the UDS provided and the UDS mentioned in the agreement differ, be sure to specify before registering the document.
- It is also important to note that owners in a cooperative society are equally allotted a UDS irrespective of how big or small their land area is.
