8-min read

The shop-buying checklist: 5 questions, 3 traps, 1 site-visit sheet

Commercial is sold on a rental number someone else controls. Here are the five questions that test that number, the three traps that hide inside the agreement, and a sheet you can carry to the site.

For first-time commercial buyers looking at a shop or retail unit, typically ₹50 lakh to ₹6 crore, who are being sold to by people who know the building better than they do.

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One number, never sold.

questions you can answer this week, for under ₹200

25–35%

typical gap between super area and carpet area

2019

the year assured-return schemes were banned by name

The 20-second version

A shop is not sold to you on the building. It is sold to you on a rent number, and that number is usually quoted by the person who benefits from you believing it.

Every check below is something you can do THIS WEEK, yourself, for under ₹200. If a check needs a lawyer and a 30-year title search, it isn't in this guide. If you cannot get an answer to one of these five questions, that silence IS your answer.

The five questions

Ask these in order. Each one has a cost, a source, and a specific bad answer to listen for.

1
1 · Is the title clean?
Pull the Encumbrance Certificate from the sub-registrar or the state portal, roughly ₹100–200. It lists every past loan and sale registered against the property. BAD ANSWER: a live mortgage that nobody mentioned to you.
2
2 · Have you checked the RERA number yourself?
Free, two minutes, on your state RERA portal. It shows the sanctioned plan, the complaints filed against the project, and the possession date the builder gave the GOVERNMENT. BAD ANSWER: the RERA possession date is not the date you were told.
3
3 · Is carpet area written down, or only super area?
Read the Agreement for Sale. Post-RERA the builder must state carpet area, and the gap between super and carpet is typically 25–35%. BAD ANSWER: the agreement quotes super area only, and carpet area appears nowhere.
4
4 · Who holds the leasing rights after registration?
Search the agreement for three phrases: leasing rights, marketing rights, tenancy rights. BAD ANSWER: any one of them stays with the developer after your registry is done. That single line decides who sets your rent for the next nine years.
5
5 · Do you know the real corridor rent?
Walk into ten running shops in the same corridor. Ask about OTHER people's rent, never your own, then drop the highest and lowest number and take the middle. BAD ANSWER: shopkeepers avoid the question, or the real number sits far below the one you were quoted.

Trap 1 · The leasing rights stay with the builder

The builder sells you the shop and keeps the right to lease it. The corridor is renting at ₹200 per sq ft, your unit gets leased at ₹120 for nine years, and the signature on that lease is theirs, not yours.

HOW TO CATCH IT: the three phrases in question 4. If leasing, marketing or tenancy rights sit with the developer after registration, you own the unit but you do not control the income.

Trap 2 · The 'assured return' that is your own money

A shop genuinely worth ₹1 crore is sold at ₹1.5 crore, and the extra ₹50 lakh is returned to you year by year as a '12% return'. It is your own money, paid back in instalments. When the scheme ends the cheques stop, and the resale value is still ₹1 crore.

These were banned by name in 2019 as unregulated deposit schemes, so the words changed rather than the mechanism. Watch for: lease guarantee, committed income, rental assurance.

HOW TO CATCH IT: ask the five-word question, 'Remove the scheme. What is the price without it?' Then line up three numbers, the circle rate, the resale asking price inside the same complex, and the scheme price. A 25–30% gap between the scheme price and the resale price IS the 'return'.

Trap 3 · Virtual space, a share dressed as a shop

A large floor is sliced into paper units. You get a tile number, not four walls. The rent is pooled and counted by the developer, and resale is close to impossible because there is nothing physical to show a buyer.

HOW TO CATCH IT: ask for the sanctioned plan and find YOUR unit's four walls on it. A drawn outline with its own entry is a shop. A number floating in the middle of an open floor is a share, and shares in an unlisted floor have no market.

If any part of the rent is revenue-linked

Revenue sharing is a partnership. Three clauses have to be in the lease or it isn't one:

A minimum guarantee, so the floor doesn't fall to zero in a bad quarter.
A monthly sales statement, filed alongside the tenant's GST return.
An annual audit right, exercisable by your own CA.

If a landlord's income depends on someone else's declared sales, the right to verify those sales is not an unusual ask.

The site-visit sheet

Print this section, or copy it into your phone, and fill it in while you are standing there. It is written to be answered on the spot, not from a brochure.

FRONTAGE: measure the width in feet and write it down. Rent follows frontage, not carpet area.
COLUMNS: is there a pillar inside the unit? A brand's fit-out layout dies on it.
WHO HAS ACTUALLY SIGNED: names and floors, in writing. 'In discussion' and an LOI are not a lease. Ask for the anchor tenant's name and lease length.
THE 7 PM COUNT: stand in the corridor at 7 pm and count people walking past.
VACANCY: count the empty units out of the total. Every third shutter down means the rent number is a story.
SURROUNDING FLAT RATES: within 3 km. It tells you what is actually in the customer's pocket.
CAM: rupees per sq ft per month, and who pays it when the unit is empty, the owner or the tenant.

The 7 pm count and the vacancy count are the two numbers nobody selling to you will volunteer.

Five lines to put in the agreement

These are normal commercial asks, malls hear them every week. Hand them to your own lawyer to adapt to your deal, they are a starting point, not a substitute for advice.

1
1 · Leasing rights transfer to the buyer on registration.
The right to set your own rent moves to you when the registry is done, and does not stay with the developer.
2
2 · If the developer leases the unit, the rent shall not be below the prevailing corridor rate.
And state HOW that corridor rate is to be measured. A benchmark nobody has defined is not a benchmark.
3
3 · Written consent of the owner is required before any lease is executed.
No lease gets signed on your unit without your signature on the approval.
4
4 · Approval timeline: 30 days, deemed approved if no written response.
This protects the operator from a silent owner, which is what makes clause 3 acceptable to them.
5
5 · Refusal must be in writing with reasons, on tenant-mix grounds only, never on rent.
It keeps you from blocking a good tenant out of spite, and keeps them from overruling you on price.

Six questions to ask out loud

Say these exactly. What matters is what the answer tells you.

“Remove the scheme. What is the price of this shop without it?”

Separates the real price from the payback dressed up as a return.

“Who holds the leasing rights after registration?”

The direct test for Trap 1. Listen for a qualified yes.

“Which brands have signed a lease? Names, and floors.”

Replaces 'there's huge demand' with something you can verify.

“Who is the anchor tenant, and how long is their lease?”

The anchor brings the footfall. Without one, the corridor stays quiet and so does your unit.

“Are you taking brokerage from both sides, or only from me?”

Tells you whose interest the person advising you is actually paid to serve.

“What is the CAM, and who pays it while the unit is vacant?”

Surfaces the monthly cost that continues even when the income stops.

The honest part

Commercial is not automatically better than residential.

Vacancy is the real risk. An empty shop still costs you CAM every single month, and there is no tenant paying it for you. Pick the wrong corridor and no tenant ever arrives at all.

Exit is slower than residential. The pool of people who buy commercial units is far smaller than the pool who buy flats, so selling takes longer and the price is negotiated harder.

And the trade, stated once and plainly: gross yields on commercial are generally higher than residential, but that is GROSS. After CAM, property tax, vacancy periods and brokerage, the net is materially lower, and every lease is different. Do that subtraction on your own deal before you decide anything.

Not legal or investment advice

This guide is general information to help you ask better questions, not legal, tax or investment advice. Commercial agreements, lease structures, CAM formulas, RERA practice and tax treatment vary by state, project and date. Engage an independent property lawyer for the agreement and a chartered accountant for the numbers before you pay any money or sign anything.

Sources & citations›

Carpet area must be stated in the agreement for sale: Real Estate (Regulation and Development) Act, 2016, definition of 'carpet area' at Section 2(k) and the disclosure obligations that follow it.
Assured-return and similar deposit-style schemes: Banning of Unregulated Deposit Schemes Act, 2019, which is why these offers are now presented as lease guarantees, committed income or rental assurance.
Encumbrance Certificate, showing registered loans and transfers against a property, is issued by the sub-registrar's office or the equivalent state portal, typically for a nominal fee.
RERA project registration, sanctioned plans, complaints and the declared possession date are published on each state's RERA portal and are free to search.
Super-to-carpet gaps of roughly 25–35% are common in Indian projects; confirm the exact figure for your unit against your own agreement, not a brochure.

Bring us the shop before you pay the token.

Most people looking at a commercial unit are getting their numbers from someone who earns when they say yes. villow is buyer-first: we verify title, RERA, the sanctioned plan and the true area before you commit, we tell you when a corridor rent doesn't hold up, and builders pay us so you don't. Your number goes to one team, ours, and is never sold.