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Commercial properties sold on assured return in trouble?

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Commercial properties sold on assured return in trouble?

Last updated: August 28 2019
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  • Commercial properties sold on assured return in trouble?

    Hi,

    Couple of days back I came across news that vatika has stopped paying assured returns to its investors, also saw a times of India article stating that the properties sold on assured return are illegal.Couple of months back, saw a circular stating that the assured return scheme should end(it was a directive if I could remember correctly). So a lot of builders are selling on "Assured return scheme"(since 2015, this trend was on the rise), I am concerned since I am an investor too in commercial properties in gcx area, so whats the fate of our investments? please let me/us know if you have any valuable info to add.

    PS: If assured return scheme is scrapped, my estimation is that the commercial market would crash (specially the markets which are in upcoming area)

    Regards
    Rahul
  • #2

    #2

    Re : Commercial properties sold on assured return in trouble?

    You are correct in saying that Assured Return is stoped by Vatika. That is also going to happen for all builders if they dont want to end up like Amrapali etc.

    This is be simply to stop people from using cash and purchase property and taking return on it in white income.

    There is surely going to be an impact in the market.

    But if we ask ourselves what was the logic in buying something in Assured Return ? Its only to use cash. If not for cash, you pay the builder your money and he gives you return on it. You can do the same by making an FD or Mutual Fund.

    Most builders sold properties with AR at appreciated value so they firstly jack up the price and then take all your money and then give your return on your own money. No person who understand the market would buy on AR anyway.

    I have never asked anyone to buy Assured Return project as its always been a high risk investment.

    Good Luck.


    Last edited December 6 2018, 01:30 PM.
    Success = 50% hard work + 50% LUCK

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    • #3

      #3

      Re : Commercial properties sold on assured return in trouble?

      rishabh2u : mate you are absolutely right but I would add one thing, if you are paying money to builders who have delivery record then you are expected to make more money than FD, you get 11% return and there is a chance that you could make some capital appreciation on top of it(not for all properties though), good builders in my opinion are Dlf, Central park, M3m, signature global, aipl (although no delivery but joystreet seems to be getting delivered), Vatika, Emaar, pioneer, Bani [these all builders have delivered in the Gcx area], I am not too worried as my investment is moving fast and expected to be delivered shortly but there is still a scare ..

      Now the major concerns are of shady builders like elan, amb, samyank, BPTP, Nxone,Wave(although this builder has delivered but off late I dont see any progress for this builder) .. assured return for these types of builders are a major concern(these builders make market fundamentals even worse and dupes investors which in return brings negative news on TV), although I would advice not to go for assured return properties if a notice about it is in circulation.

      Rest, only time will tell ....

      PS: the list is long for Gurgaon for shady builders and even longer for Noida
      Last edited December 6 2018, 03:14 PM.

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      • #4

        #4

        Re : Commercial properties sold on assured return in trouble?

        Do you have any new update from Vatika on how are they now going to pay the money back to Investors ?
        Success = 50% hard work + 50% LUCK

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        • #5

          #5

          Re : Commercial properties sold on assured return in trouble?

          Any update folks on what is happening with the assured returns from Vatika. I have got a letter saying they are NOT going to pay anymore
          Success = 50% hard work + 50% LUCK

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