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Don't Get Swayed Away By Freebies While Buying Real Estate


Don't Get Swayed Away By Freebies While Buying Real Estate

Last updated: March 23 2013
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  • Don't Get Swayed Away By Freebies While Buying Real Estate

    Post recession many areas sprung up with claims to offer affordable homes and everyone hopped to grab the opportunity . Fixation with lesser prices was so high that no one enquired properly about the areas. "The only thing that prevailed and mattered was the prices. The buyer forgot to stick to the main rule of real estate investment , that is, enquire before investing. They did not enquire about the area, the land title, turned a blind eye to the surroundings and invested because everyone was investing" , says Dujender Bhardwaj, director , JMD Realty Pvt. Ltd.

    Investing in real estate is one of the most valuable acquisitions that we make in our lives. But a mistake in the purchase can be a testing experience especially for those who dream for at least one home in life. So one must act smart and do proper homework before buying a property. Let's have a look at the areas in demand and current trends in the real estate industry so that you feel at ease while buying a property and get the most legally secure property.

    Delhi has always been in demand but because of exorbitant property rates, people prefer to buy properties in NCR, which includes, Noida, Greater Noida, Indirapuram, Raj Nagar Extension, Gurgaon, Faridabad, Bhiwadi and Dharuhera. But as different parts of NCR cater to different segments of the market, it's difficult to make a comparison between areas, feels Getamber Anand, managing director, ATS Group and vice president, Credai. "Noida is currently witnessing a proliferation of budget housing whilst Gurgaon, having the headstart in real estate over other areas, has more midsegment and high-end offerings" , adds Anand

    Different developers have different opinions. Basically, it's all about a buyer's need; he goes for what suits him the best in terms of his office, kids' school, parents, friends, markets and hospitals.

    Prashant Solomon, joint managing director, Chintels India, says: "Gurgaon is the most in demand and in particular New Gurgaon, which is coming up on the Dwarka Expressway just a stone's throw from Terminal 3 of IGI, Dwarka and Palam Vihar. This is because of the fact that Gurgaon is an IT hub, which provides employment opportunities along with the best infrastructure in terms of schools, roads, housing societies and medical facilities. It is famous for its outsourcing and off shoring services that contribute the most towards the economy of Gurgaon."

    Talking about property rates, there is a major difference between Delhi and NCR; even the rates within NCR vary from area to area. According to Solomon, "We have not seen much of construction happening in Delhi except for areas like Dwarka and it is still the most expensive option segment if compared to the NCR. However, the trend could change as more and more people begin to look for accommodation in Gurgaon, Noida, Indirapuram and other parts of the NCR." As far as the rates are concerned, in Delhi it varies from Rs 5,000 to Rs 1,50,000 per sq. ft. depending on location. In the NCR on the other hand, the rates could vary between Rs 2,500 to Rs 15,000 per sq. ft., again depending upon the location. In the NCR, the property rates are known to be the highest in Gurgaon and Noida, followed by Indirapuram, Faridabad, Meerut, Sohna, Bhiwadi and the like.

    "From the last quarter, real estate industry is somehow feeling the heat, for Mumbai market showcased a dip by 10 per cent to 15 per cent. But the NCR market is stable except Noida. The rates went down almost 15 per cent due to Noida Extension and Bhatta Parsol issues" , informs Bhardwaj. Future Trends

    According to Anand, "Over time, markets will respond to the market demand and adjust to the supplies accordingly. All the markets will have products across all the segments, though the relative weights may vary due to various micro-market conditions and factors."

    He adds, "The real estate industry is evolving and is today institutionalised to a great extent. The developers are organised into effective trade bodies like CREDAI who are self-regulating their members.

    The code of conduct initiated by CREDAI for their members is a step in this direction. If the customers are careful in choosing the developers and their particular projects, there should be at ease and not feel cheated at any stage."

    Source: Economic Times

    Mon Jun 06, 2011
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  • #2


    Re : Don't Get Swayed Away By Freebies While Buying Real Estate

    In realty, do not get carried away by freebies

    In realty, do not get carried away by freebies - Economic Times
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    • #3


      Re : Don't Get Swayed Away By Freebies While Buying Real Estate

      There is an old saying: Empty Vessels make a lot of Noise

      Chances are that the more sub-standard a product is, the more marketing, advertising needs to be done.
      If one is getting a deal that is too good to be true, one should proceed with caution. If not much time, a simple google search should suffice.


      • #4


        Re : Don't Get Swayed Away By Freebies While Buying Real Estate

        Beware of foxing freebies while buying a property

        Most developers are offering freebies to attract buyers into investing in their property. While some are genuine, most offers are advertised to lure investors and hide the actual cost in such projects.

        The tactics don’t seem to be working of late in the Indian market. Investors have become doubly cautious of any dubious deals and pay close attention while investing money. The property investment scenario has changed and it is not ‘following the herd’ as was the case a few years ago. No doubt, schemes related to property purchase are welcome by middle class buyers but one should check the underlying asset. Some of the common tactics adopted by builders and the prerequisites to check before investment include:
        Imminent rate revision: Mass messaging by developers, usually on FM radio is an easy option for advertising property. One of the common methods is to send messages of asking a buyer “hurry now, as prices would get revised soon”. These messages are usually louder during festivals. If you plan to invest with such developers, the better option is to go and check out the “promised land” in person. Don’t rely on any housing agents and brokers because they often work for maximising their incentives.

        Targeting human psychology: Developers often appeal to human psychology and target buyers. Indian customers are lured to gold, cars, modular kitchens and travel vouchers etc. However one should check the property and relate it with these extras the developer is giving. For example, if he is offering a car along with an apartment, the investor should check the distance of the workplace from the location of the apartment. If the location is very far and the travel time and traffic is more than what you have to deal with every day, it is better to stay away from the deal or invest the money in an option that will reduce your travel time.

        Compare the effective cost: As the adage goes, “there is no free lunch” and applies to freebies too. They are included in the cost of your property. If one is comfortable in investing with these extras thrown in, it is fine but if the costs are too high, it is advised that you apply a value for money approach.

        Check your Capacity: The clientele of the property developers or the target segment often plays a crucial role in driving demand. If the property is for high net worth individuals (HNI) who often don’t mind paying extra for the property, then offering the freebies approach becomes irrelevant in this context. Affordability is a critical aspect when you hunt for a property, do not spread yourself too thin by stretching your budget and loan capacity to purchase your dream home. Remember investing in a fixed asset like a house requires careful planning and allocation of funds and more importantly there should be a certain comfort level in paying the EMIs, with sufficient funds present for contingencies, savings and other commitments.
        Reality of Realty: The reality of real estate is that the affordability of the middle class is getting challenged by high inflation that has reached almost 11 per cent. The prices are high in property markets and that is maintained by a very affluent business class that can afford to keep the rates intact due to the cash float they have. In India, we don’t have ‘ghost cities’ like in China yet but there are increasing cases where the aspirations are not meeting the end result.

        A large section of the middle class is in the purchasing power band of Rs 30-35 lakh at the lower end and Rs 40-45 lakhs on the upper end. A property which is lower than the base-end of Rs 30-35 lakhs carries more disadvantages than advantages. The accompanying table shows the merits and demerits in different bands.
        The order of the day is to check and invest and not to get lured by freebies. Quite a few have become vigilant of attractive and luring schemes while some others still need to acquire the right awareness surrounding a property purchase.

        —The author is CEO,

        Source: The Financial Express By: Adhil Shetty Publish: 23-March-2013
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