In real estate, there are a lot of terminologies that you should be aware of where one of which is comprehending the nitty-gritty of the Undivided Share of Land. Therefore, we have researched extensively and have penned down the application, definition and advantages it provides in the real estate market. If you are an experienced investor who wants to expand your financial portfolio or if you are an individual keen on entering the market by extending your knowledge, then in this blog, we have explained everything in detail, specifically about the concept, where you will be vehemently equipped with important insights, so that you can make strategic decisions.

The Undivided Share of Land allows people to possess a fraction of the share of the entire property, and also share the advantages and responsibilities which are related to it. There is an original dynamic introduced by the Undivided Share of Land which inhibits collaboration, cooperation, and also using the land resources effectively.

What Does Undivided Share Include?

Undivided Share of the Land is a common term that has been used to showcase the ownership of a share of various common areas and land, which is in multi-unit developments like housing societies and apartment complexes. When a home or apartment is inclusive of an extensive development, the Undivided Share constitutes the proportionate share, which is of the common areas and total land that has been allotted to that unit.

It portrays the entitlements and rights of the unit owner and also the undivided share of the land, where the entire development has been built on it. This is usually a fraction or percentage, which shows the stretch of the unit’s owner and their ownership rights, which are for the shared areas. This is inclusive of staircases, corridors, gardens, lobbies, parking spaces and various other amenities that are shared by each and every resident.

Importance of Undivided Share

When comes to its significance , the first one to note is the ownership rights where the undivided share of land portrays the share of land that is proportionate in nature and which an individual owner has, and it is in a property that is jointly owned. In addition to this, the undivided share assists in initiating the legal entity, which is of a multi-unit development. It also aids in properly defining the rights and responsibilities, which is of the individual owner and is considered to be within the structure of a large property. It also helps in deciding the allotment of common facilities and amenities, which is between the property owners. It also plays a very important role in regulating the expenses and maintenance that are connected with the common areas.

The Undivided Share can have a major impact on the market value of the various individual units, and it is inside the multi-unit development. It is also an important aspect in the financial and legal which are related to the property. Last but not least, it also impacts the possibility of property expansion or development.

The Undivided Share in Flats and Apartments

When you buy a flat or apartment in a housing complex or building which is multi-storey, you will gain ownership rights of not just to the unit that is individual, but also towards a proportionate share, which is of the land and it is on which the total building has been built. The share entails the entitlement towards the facilities and common areas, which are in the apartment complex. The percentage of an undivided share has a major influence on the quantum costs which is associated with the maintenance of shared facilities and areas. The possession of the common areas is shared between families and various individuals, where, for this, the undivided share is important for administrative and legal matters which are related to the flats or apartments.

The undivided share of land also explains the scope of changes, which is to the common areas and is in the apartment complex. The resale value of the flats or apartments can be impacted because of the proportion. If there is a higher share, it increases the property value, where it also represents a bigger stake in ownership in not only the shared areas but also the land. The undivided share also plays a very important part in the managing of the apartment complex, which is through the owner’s society or association.

Undivided Share in the Real Estate Transactions

The Undivided Share of Land is a terminology which is employed in the transactions of real estate, in order to depict the ownership rights or interest of an entity or individual, and it is in the land or property which is collectively owned. This is usually utilised in various instances where the property has been split into various portions or units. Each of the particular units has its own associated Undivided Share, where it is expressed in the form of a fraction or percentage, where it represents the share of the owner, which is in the facilities and shared areas of the property.

It influences various aspects like voting rights, maintenance charges, and also different allocation of expenses. It is essential to review all of the data precisely, which occurs during a transaction, where it impacts the shared facility expenses and ownership rights. Any type of particular regulations might differ, so it is essential to consult with a legal expert or a real estate professional who is skilled and experienced with the local practices.

The Undivided Shares as per the RERA Guidelines

When it comes to the Real Estate Regulatory Authority, i.e., RERA, it is a regulatory body which is situated in India and this is done in order to protect the interests of the real estate purchasers and also so that there is clear and precise transparency in the real estate industry. Although there is a variation in state to state of the RERA guidelines, the concept is said not to be particularly mentioned in the guidelines or the central RERA Act.

But, it is essential to take into account that a few of the RERA regulations which are state-specific, might label the problem of the Undivided Share or a familiar concept, which are connected to the possession of shared areas, which are in the real estate projects. For instance, in states like Karnataka and Maharashtra, which have executed their own RERA rules, there are facilities for revealing common areas and the share which is proportionate to each of the unit owners and which is in those places.

Undivided Share of Property being Sold

This aspect is usually used in nations like India, where it is a consistent practice in various property transactions, specifically in housing societies or buildings that are multi-unit. In these cases, rather than selling individual apartments or units, the owner or developer sells out a particular fraction or percentage of the entire property, which is usually referred to as the Undivided Share. Some of the main points to note are that when you sell the Undivided Share of Land, it implies transferring a particular percentage of the entire property’s ownership rights to the purchaser. Then the purchaser becomes the co-owner of the building which is along with the Undivided Shareholders.

The holders also have shared ownership of various shared areas, facilities and amenities which is within the property like gardens, swimming pools or clubhouses. Like any other transaction of real estate, the sale of Undivided Share needs appropriate legal documentation. This is inclusive of transfer of ownership, sale agreement, and registration of the share, which is in the name of the purchaser. The Undivided Share holders usually share in various responsibilities, which are for managing and maintaining the common facilities and areas. In addition to this, the shares can either be transferred or resold to the purchasers. The process is inclusive of gaining a No Objection Certificate (NOC), which is from the housing association or society and it is along with the important clearances and documentation.

How Can One Calculate the Undivided Share of Land?

The Undivided Share is calculated in the housing societies or buildings which have multi-unit structures, where there is the inclusion of shared spaces. In order to calculate it, some of the information is required, like the entire land area of the property, the area of all apartments which are super built-up and the super built-up area of a particular apartment or unit, for which the Undivided Share has to be calculated. This is inclusive of the carpet area, where the carpet area is the area that can be used within the walls, and also the proportionate share of all of the shared areas like staircases, corridors, elevators and more. After all of this information has been gained, a formula can be used where the Undivided Share is equal to the super built-up area of the unit, which is divided by the super built-up area of all of the units and then all of this is multiplied by the total land area.

The Undivided Share (UDS) in Various Types of Property

When it comes to the Undivided Share in apartments and flats, i.e., in a residential project which is multi-story, where the UDS is allocated proportionally and it is established on the carpet area of a particular flat. Therefore, the owners whose flats are bigger will have a larger share of land. This share is important, and it is specifically during the redevelopment, or it is also when there is appreciation in property. When it comes to row houses and villas, they usually have shared and private land components. In such circumstances, the UDS is applicable towards the shared portions, which is inclusive of parks, internal roads and clubhouse facilities. One of the main considerations to know is that the villa’s or row house’s private land area is not considered to be a part of the Undivided Share, but is owned by the individual.

With regards to the commercial properties, the Undivided Share’s formula calculation is almost similar to the residential properties. But it is much more significant because of the increased land value, which is in the commercial zones. The commercial projects are regarded as a special case, because of various factors like shared utilities, parking spaces and also floor-level preferences, which further influence the allotment of the Undivided Share.

Various Factors which Influence the Allocation of Undivided Share

The first factor to consider is the property configuration and size, where the larger units are said to be allocated to an increased Undivided Share because the share is said to be proportional to the carpet area. There are also unique configurations like duplex apartments and penthouses, which receive a personalised UDS allocation. Another factor is the policies of the developer, where they might allot the UDS, which is based on various premium features that are in the building and also for various extra facilities. For instance, it can be the parking places. If there is a transparent assignment of policies, there is said to be a scope for minimal disputes and also an increase in the confidence of the buyer.

The last factor to consider is the local zoning laws, where the rules like the floor space index will influence the allocation of the Undivided Share. For instance, there are high-rise buildings which involve construction on land and which might affect the Undivided Shares that are individual in nature. There is also allotment of Undivided Share in flats, which might influence the rules of urban planning and which also have limitations and therefore, it has an effect on how the developers distribute it.

Undivided Share in Investment and Valuation

When you are buying in the real estate market, it is important to know how the Undivided Share affects the value of the property. For those properties where there is an increase in the UDS, they tend to appreciate extensively because of the value of the said underlying land tends to increase consistently. This also implies that there is stability, which is during the fluctuation of the market and also because of the value of the land remains unchanged or also normally appreciates.

But if you are a real estate investor, then you should consider transparency, where the projects that have a clear definition of the Undivided Share will be more sought after by the investors. There should also be due diligence where the investors and buyers should also estimate the Undivided Share, which is among properties, in order to evaluate the value which is long-term.

There is also potential for an upgrade for this in the future, where the redevelopment agreements are said to be dependent on the calculations of the Undivided Share, where the higher UDS owners gain compensation, which is beneficial. The owners, who have extensive Undivided Share, will also have a bigger leverage when it comes to negotiation and it is in the redevelopment projects.

Familiar Misunderstandings and Their Clarifications

The Undivided Share is usually confused with various other real estate concepts like joint ownership or carpet area. When it comes to the carpet area, this is the floor which will be used in an apartment, and it does not involve common places like lobbies and staircases. This is considered to be a physical space that the owner can use directly. But when it comes to the Undivided Share of Land, it is an intangible ownership of the land, and it is on which the building has been built. This is further proportional to the flat’s carpet area. A clarification between the two is that in UDS, the land is shared legally, but in carpet area, this is just a physical measurement of the flat, where if the apartment’s carpet area is larger, there will be a higher Undivided Share.

When it comes to the Undivided Share in joint ownership, for instance, if there is a single flat but there are a lot of owners where they are members of the same family, then the UDS will be divided and it will be as per the share in the apartment. To make it clearer, irrespective of the split in the ownership, the amalgamated UDS is said to be combined legally to the apartment. Also, the person will not be able to transfer it independently or sell it. With regards to the Undivided Share and the maintenance charges, it should be noted that there is a common misunderstanding that the maintenance charges of the apartment are directly corresponding to the Undivided Share. But actually, the maintenance expenses are calculated on the basis of the super built-up area, which is inclusive of the carpet area, and it is also inclusive of the common spaces that are being shared.

Therefore, the Undivided Share has a lot of value in the real estate market, where it is a main factor in the ownership of property, especially for multi-storey or multi-unit buildings. Hence, with a total understanding of it, the investors and buyers can make better decisions, so that their interests and rights are protected.