The Maharashtra Industrial Development Corporation is one of the prime agencies allotting land for business industrial development or investment in Maharashtra. MIDC allocates land for industrial purposes with added emphasis on the growth of industries and companies in the state.
But when purchasing land from MIDC, prospective buyers generally have two major options: acquiring newly allotted MIDC land or purchasing a resale MIDC plot. Though both types have their own set of pros and cons, understanding the principal differences between the two, particularly regarding cost, legal issues, development status, and long-term growth opportunities is very important.
What is Freshly Allotted MIDC Land?
Newly allotted MIDC land comprises land that is offered for sale or leasing by the Maharashtra Industrial Development Corporation. Such land has recently been brought on sale or lease to industrialists and business houses, typically in newly established or emerging industrial zones. These plots are usually a part of the MIDC's attempts at industrial development, and allotment is made through a formal process with well-defined rules regarding pricing, land use, and zoning.
When you buy a newly allocated plot, you are essentially purchasing from MIDC in a more formalized and systematic buying process. The land is generally in a developing or developed industrial estate, and the necessary infrastructure (roads, water, electricity, etc.) is already in place or being developed.
What is a Resale Plot in MIDC?
A resale MIDC plot is unvalued because this allotment was directly from MIDC to some person or organization, now put on secondary sale. The plot may have had previous business use, but the owner may no longer need it due to personal, financial, or other business reasons.
These resale plots are usually exchanged between private parties or organizations, although MIDC's participation is necessary for approvals and documentation. When you purchase a resale plot, you are basically buying land that was initially part of the MIDC allotment but has come into circulation through private transactions.
Key Differences Between Purchasing Newly Allotted MIDC Land and Resale MIDC Plot
1. Ownership Status and Legal Complications:
- Freshly Allotted MIDC Land: MIDC directly administers the sale of such plots, and the land is encumbrance-free, free from pending liabilities, or prior legal complications. Because these plots are newly allocated, the ownership title is generally clear and not in dispute.
- Resale MIDC Plot: A resale plot may come with some legal complexities. Although MIDC originally granted the land, there may still be issues like pending dues, tax charges, or title disputes with the former owner. It's always necessary to ensure the seller has a clear title and all legal documents are in place before going ahead and buying it.
2. Documentation and Transfer Process:
- Freshly Allotted MIDC Land: The procedure of documentation in the case of newly allotted land is generally smoother. MIDC adopts a clear-cut and transparent mechanism for allocating land so that transfer of ownership takes place in an efficient manner. You shall have proper agreements, allotment letters, and title deeds all sanctioned by MIDC.
- Resale MIDC Plot: The resale is a lengthy process because you'll have to get the consent of MIDC for transfer of ownership. Make sure that the seller has gone through the past formalities such as paying all the dues.
3. Price and Market Value:
- Freshly Allotted MIDC Land: The rate of freshly allocated MIDC land is decided by MIDC in accordance with the place, infrastructure, and industrial zone location. The plots are likely to be more uniformly priced, as they are new issues and usually have pre-fixed rates in accordance with the development plan. The rate is fixed and no negotiation is allowed.
- Resale MIDC Plot: Prices of resale plots are diverse and may differ based on several factors, such as the initial price paid for the plot, location, demand, and any development of the plot.
4. Development Status and Infrastructure:
- Freshly Allotted MIDC Land: MIDC plots for the most part find themselves in areas with already enunciated infrastructural facilities. This will mean that the roads, water supply, drainage, and electricity will be in place or planned. MIDC usually chooses locations that are in tune with strategic growth plans, giving the business easy access to the most basic of services and conveniences.
- Resale MIDC Plot: Resale plots like newly allotted plots have road facilities, water supply, drainage, and electricity facilities.
5. Use and Zoning Regulations:
- Freshly Allotted MIDC Land: MIDC plots are earmarked specifically for industrial, commercial, or business-oriented purposes, and use of the land is subject to regulation. If you're purchasing a plot for industrial or business purposes, this can be favorable, given that the land is already in the industrial zone with defined zoning laws.
- Resale MIDC Plot: Resale MIDC plots are subject to the same zoning restrictions as fresh allocated plots. But during resale, there could be some negotiations about land use. You also need to check whatever restrictions, if any, or conditions of the original allotment impair how you'll use the land. The purchaser may need to seek modifications or houses based on intended use of the land.
6. Availability and Timeframes:
- Freshly Allotted MIDC Land: Buying freshly allotted land can be time-consuming because of the formal application process, approvals, and possible waiting times for infrastructure development. MIDC has a systematic process for allotting plots, so the process might be slower than buying land in the resale market.
- Resale MIDC Plot: Resale plots are usually ready for transfer at once, provided all legalities are done. If you require land on a shorter time frame, buying a resale plot might be quicker because the plot has already been allotted, and you just have to handle the change of ownership.
Advantages and Disadvantages of Buying Freshly Allotted Plot
Advantages:
- Clear Ownership: Since MIDC directly handles the allotment, you can be sure that the title of ownership is clear and without encumbrances.
- Developed Infrastructure: These plots are part of planned industrial zones, with established or developing infrastructure like roads, water, and electricity.
- Government Guarantee: Being purchased directly from a government agency, there is less risk of legal issues, fraud, or title disputes.
- Location Choice: MIDC typically selects locations based on strategic industrial growth plans, providing businesses with prime locations.
Disadvantages:
- Longer Processing Time: The formalities and approval process may take time, which can delay the final purchase.
- Limited Negotiation Power: The price for freshly allotted land is often fixed, meaning there is no room for negotiation.
- Restrictive Land Use: The land is usually zoned for industrial or business use only, limiting its versatility.
- High Demand: Popular locations may have long waiting periods due to high demand for MIDC plots
Advantages and Disadvantages of Buying a Resale MIDC Plot
Advantages:
- Immediate Availability: Resale plots are often available for transfer immediately, and you can start developing or using the land without having to wait for MIDC approval.
- Flexible Terms: There may be more flexibility in terms of payment terms and negotiation with the seller compared to dealing with MIDC.
- Established Ownership: The resale plot tends to have an established track record of usage, which may give hints about how suitable the land is for your use.
Disadvantages:
- Legal Risks: There is more likelihood of finding legal disputes, unpaid charges, or dubious title conditions, hence detailed due diligence is crucial.
- More Bureaucratic Process: The process of transferring title can be more laborious, involving extra paperwork and potentially requiring MIDC approval.
- Volatile Market Value: Resale plots can vary greatly in value, depending on the seller's circumstances and demand in the market, making it harder to determine fair value.
Conclusion
Both freshly alloted MIDC plots and resale MIDC plots have their advantages, and your choice must be based on your individual needs, budget, and timeline. If you want a well-regulated, government-supported investment in a strategically developed industrial area, a freshly alloted MIDC plot is a good choice. But if you want to negotiate price and availability, resale MIDC plots may be the preferred option.
