A warranty is a contractual promise. An individual making a promise is regarded as undertaking contractual liability, therefore, where a warranty exists, the maker undertakes strict liability for what he asserts. In simple words, it is an agreement between a buyer and a seller, detailing the conditions under which the seller will make repairs or fix problems without cost to the buyer.
Also, a warranty is an assurance by the seller of the property to the buyer that a property is as represented or will be as promised and the seller insures the buyer that the insurance risk or all the terms and conditions specified in the contract would be fulfilled as stated to keep the contract effective.
Indian developers are not providing any warranty on properties. The contract or the development agreement details the agreed price, payment and construction schedule, apartment plans, delivery date and the developer’s liability in case of delay in handing over possession and the developer bears no liability after he has handed over possession to the buyer of the property.
The builders are now recognising the need to commit themselves to quality construction to safeguard the interest of the investors and some developers have started offering a warranty on the building and construction material. However, this new trend was introduced for the first time in the history of real estate development by Pune-based Gera Developments, which is now being followed by other real estate developers.
The five-year warranty that is now being provided by some of the developers in India ensures that the property remains in premium condition and covers three main areas: preventive maintenance in the areas of carpentry, electrical diagnostic works, plumbing and bathroom tiles; repairs as a result of improper installation or supply from company’s end, and re-paint of the exteriors of the building to make it look new before the end of five years, which also maintains the prime real estate value of the property.
In this regard, the Government of India should introduce a new legislation that should make it mandatory for all the real estate developers to offer warranty plans to its investors, as it would build an environment of trust and transparency, which is lacking in the real estate sector at present. This will surely help the sellers in getting a better commercial value of the property and the buyers will have a peace of mind while buying such a property. The quality standards in terms of service delivery and construction are not yet up to the mark and the introduction of such legislation would automatically improve it to international level.
http://news.moneycontrol.com/india/news/propertyexpert/null/newtrendwarrantyproperty/14/38/article/187166
