Real Estate Common Terms – You Should Know

Real Estate Common Terms – You Should Know
October 10, 2019 No Comments Real Estate PARAMHOMES
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It often happens that you go through a property buying experience but are unfamiliar with the Real Estate common terms used in the industry. The terms that you see while going through a builder’s brochure or an advertisement can be very disturbing and cautious. If you don’t know what they mean you will never know what advantages and disadvantages you are up for. So here are some common terms used in Real Estate Industry that might come handy while going through home buying experience next time!

  • BSP –

BSP is what we’ve all studied in our maths classes. It’s “The BASIC SELLING PRICE” of the property that the owner/developer/builder is offering you. Very commonly used and still very rarely known. It is usually exclusive of the extra charges you might come through example; taxes, preferential location charges, and other maintenance dues. The price which is advertised by developers and forms the main cost of your property is the BSP.

  • CLP

When the developers complete a certain construction target, the bank will release the loan amount credited to the developer. These kinds of plans are called “CONSTRUCTION-LINKED PAYMENT PLANS (CLP”). Real Estate is full of schemes and offers. CLP plans were introduced by banks to lower risks which results in fast construction and also eliminated inordinate delays in possession which was causing home buyers a great issue. This plan cuts down the risk for banks as well as the buyers.


Assured Returns is one of the most common terms used to attract buyers in Residential as well as commercial projects. Many builders promise 12-18% Assured returns on their Projects till their possession. But it is declared as an “illegal scheme” by the Security and Exchange Board of India (SEBI). It is a fixed monthly return that the builder gives to the investor on their invested amount. It is usually for under-construction projects. Many times, credible Real Estate Builders and developers do give assured returns, but it is good to go for market research about your developer forehand.


Lease guarantee is a term used in the commercial Real estate when the Developer pledges to perform investor’s entire obligation under the lease, for the time mentioned in the lease. These types of schemes are helpful when investing in any Real estate Property because it is a big amount invested. If you have invested in a commercial property, the Builder will promise you to pay the rent of the property whether or not the builder gets any other tenant for the property.

  • EDC –

EDC means External Development Charges. It’s a onetime charge that you’ve to pay apart from your property. Extra infrastructure, Water & Sewage pipelines, Horticulture, Roads, Pathways, Streetlamps, power supply, battery backup, solar systems, lifts, Maintenance etc. are categorized under EDC.

Home buying can be a tricky task and often builders take advantage of these factors. It is important to know where to invest and when to invest. These real estate terms can alter your home buying experience and you can end up with better options and schemes to choose from.

It is also advised to visit any site with a realtor. You won’t visit a court without a solicitor, why visit a site without a realtor? Real estate consultancies provide a better option and are in constant market touch. They compare budgets, site ratios, and other amenities better then you can think of. Also, they often provide you great deals at a better price and know the history of your builder.

So Happy Homing this Festive Season!!   

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