Complete Due Diligence Checklist
A property buyer need to do a complete due diligence checklist. Buying property in Karachi is a major investment. Whether you’re looking at Scheme 33, DHA, Bahria Town, or Gulshan-e-Maymar, due diligence ensures you don’t fall into fraud, hidden costs, or legal complications. Here’s a step-by-step guide covering all factors you must verify before finalizing any deal:
1. Legal Verification
- Ownership Documents: Sale deed, allotment letter, or sub-lease must be original.
- Title Search: Ensure the seller has clear title (no shared or disputed ownership).
- Encumbrance Check: Confirm property is free from mortgage, liens, or court cases.
- Power of Attorney (if applicable): Verify if seller has legal rights to sell.
- Society/Authority NOC: Confirm approval from relevant authority (SBCA, KDA, DHA, Bahria, etc.).
2. Society & Regulatory Approvals
- NOCs: Layout plan and project NOC from SBCA or CDA (if Islamabad).
- Development Status: Confirm the property is in a developed sector, not just a “file” without possession.
- Transferability: Ensure the society allows transfer, and check for transfer fees & charges.
3. Financial & Tax Records
- Property Tax Clearance: Verify municipal property tax is paid.
- Utility Bill Clearance: Ask for latest bills of K-Electric, SSGC, KWSB.
- Capital Gains & Withholding Tax: Calculate applicable taxes if buying or selling.
- Hidden Costs: Society charges (maintenance, transfer, documentation fees).
4. Physical & Technical Inspection
- Site Visit: Always visit the property personally.
- Demarcation: Check plot boundaries on ground match documents.
- Construction Quality: If house/flat, inspect with an engineer (structure, plumbing, wiring).
- Access & Infrastructure: Roads, water supply, drainage, streetlights, and security presence.
- Encroachments: Ensure no illegal occupation, katchi abadi issues, or government land overlaps.
5. Market Evaluation
- Comparative Market Analysis (CMA): Compare prices in same block/society.
- Rental Yield: Check rental demand if investing.
- Future Development: Upcoming highways, metro, or commercial centers can boost value.
- Liquidity: How fast do properties sell in this society?
6. Seller’s Background
- Identity Verification: CNIC check of seller (match with property documents).
- Past Dealings: Reputation in market if they are a developer/agent.
- Joint Ownership (if any): All owners must sign the agreement.
7. Agreement & Payment
- Bayana (Token Money): Always document it properly with clear refund/forfeit terms.
- Payment Method: Use pay orders, bank transfer, or escrow (avoid cash).
- Final Agreement: Signed by both parties, witnessed, and stamped.
- Registration: Register sale deed with sub-registrar (if lease property).
8. Red Flags to Avoid
- Prices far below market average (likely scam).
- Seller avoids showing original documents.
- “Urgent sale, cash only” pressure tactics.
- Property under litigation or unapproved societies.
Final Thoughts
Due diligence is not just about checking documents — it’s about covering legal, financial, technical, and market factors together. Skipping even one step can result in financial loss, legal trouble, or years of dispute.
At Ustaad Group, we guide clients through complete verification and safe transactions, ensuring peace of mind before buying or selling property.
| Category | What to Check | How to Verify | Why It Matters |
|---|---|---|---|
| Legal Verification | Ownership docs (sale deed, allotment, sub-lease) | Verify originals with registrar/society | Confirms true ownership |
| Encumbrance (mortgage, liens, disputes) | Registrar office, society records | Ensures no legal burden | |
| Power of Attorney validity | Cross-check CNIC & court notarization | Prevents fraudulent sales | |
| Society & Approvals | NOC from SBCA/KDA/DHA/etc. | Ask society or authority office | Ensures legality of project |
| Development status (plot vs. file) | Visit site, ask society office | Developed plots safer than files | |
| Transfer rules & fees | Confirm with society office | Prevents surprise costs | |
| Financial & Tax | Property tax clearance | Municipal tax receipts | Avoids penalties on buyer |
| Utility bill clearance | Latest K-Electric, SSGC, KWSB bills | Ensures no hidden dues | |
| Capital gains/withholding tax | FBR website, tax advisor | Calculates real net profit | |
| Physical Inspection | Plot demarcation & boundary | On-site survey with society map | Confirms land size & location |
| Construction quality | Hire engineer/architect | Reveals repair costs & defects | |
| Infrastructure & access | Roads, water, drainage, streetlights | Affects daily living & value | |
| Market Evaluation | Comparative Market Analysis | Zameen, Graana, local agents | Sets realistic price |
| Rental yield potential | Local rental listings | Determines ROI | |
| Future development | Check master plans, upcoming projects | Increases long-term value | |
| Seller’s Background | CNIC verification | Match with NADRA/ownership docs | Prevents impersonation |
| Joint ownership | Ensure all co-owners sign | Avoids disputes later | |
| Agreement & Payment | Bayana/token documentation | Written agreement with witnesses | Defines refund/forfeit terms |
| Payment method | Bank transfer, pay order, escrow | Safer than cash | |
| Final registration | Sub-registrar or society transfer office | Legalizes ownership | |
| Red Flags | Prices too low, no original docs, urgent “cash only” | Ask multiple agents, avoid pressure sales | Protects from scams |
Please click here to contact Ustaad Group for construction or real estate projects.
