Ankur Gupta, Joint Managing Director, Ashiana Housing Limited writes for Track2Realty as to how could one spot the right kind of developer in a cluttered housing market.
“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world” a statement was made by Franklin D. Roosevelt, 32nd President of United States. His words completely hold true even today. Property can be the safest investment in the world but like Mr. Roosevelt said, it needs to be purchased with common sense.
There is a significant shift in the real estate sector with the recent price increase in the cost of the raw material used for construction. As per the Magicbricks’ Propindex Report, the recovery rate of demand for residential real estate has been faster in the second wave.
Residential markets such as Bengaluru, Chennai, Kolkata, Delhi and more have witnessed price corrections ranging from 1%-2.3% during the quarter, suggesting the solidity of the housing sector even in difficult times. However, with this price increase, you will still come across certain real estate brands offering discounts and continuing to sell at the previous cost of construction. In such a scenario, how does one choose the real estate player who is honest and fair in his dealings? My simple answer would be go with a genuine brand but how does one identify what is genuine.
We all want to invest in an ideal real estate partner and want to receive the best returns on it but unfortunately, most of us don’t have the guidance or the knowledge to examine the factors required for evaluating a genuine real estate player. I would like to make this task easier for everyone by providing some tips that may help you to make the right decision when looking to invest:
FINANCIAL HEALTH: The most important aspect to be considered while looking for an honest real estate brand is to check their financial performance–as it will have a direct impact on timely completion and delivery of your home. Have a look at the company balance sheet, get a deep understanding of the assets owned and the liabilities owed by a certain brand.
If an organization does not have too many liabilities, means you are in safe hands. And if you are not too friendly with the financial data and numbers presented in a balance sheet, do take help from your family members or your friends who would have a financial background and check the key insights represented in it. Additionally, go through company’s portfolio on their website.
BACKGROUND CHECK: Thoroughly go through the past records of the brand that you are considering to invest in. When I say past records, it means look at their older projects already existing in the market. Have they focused on timely delivery of the projects or have their projects mostly been delayed. This will give you a fair idea that the brand you are planning to invest in, does it stand true to its words or not.
You can also consider to receive recommendations from the bank that you are seeking home loan from to understand the background of the real estate brand and accordingly shape your decision. Track record of the developer is easily accessible to the housing finance companies. Make sure that you also reach out to them and understand the background on your developer.
VISIT THEIR OLDER PROJECTS: Visiting some of their existing properties will help you to get a better understanding of the facilities that the respective builder provides and is not conceding on core essentials such as power back-ups, water supply, provision for parking space and other amenities like club house, swimming pool, sports facilities and more. Also, during the site visit, you will get an insight on how the project has been maintained during all the years of its existence. Who is maintaining the project? Is the developer committed to maintain the project? It will have a reflection on quality of construction as well.
TALK TO RESIDENTS: Another important element is to connect with the customers residing in the respective project to gather their experience with the developer, construction quality, delivery timelines and the fulfillment of promises – like club house facilities, amenities, fitment and fixture in flat. The brand’s equation with their clientele is one of the most crucial parameters to judge their credibility.
RERA REGISTRATION: Ensure that you visit RERA’s (The Real Estate Regulation and Development Act) website and check for the complete project details there. It seeks to protect the interests of home buyers and boost investments in the sector.
Following the tips suggested above, you will be in a position to make an informed decision in finding the right real estate partner for your dream house or dream project. Furthermore, it is important to note that a genuine developer will quote the right cost encompassing the rate of construction including the market valuation instead of just earning high margins. He will ensure timely delivery of the project with full commitment towards quality procedures, complete ownership of maintenance and follow RERA guidelines, in detail.
Hope these strategies help you in making the correct judgement call when it comes to making an investment of a lifetime.
Track2Realty is an independent media group managed by a consortium of journalists. Starting as the first e-newspaper in the Indian real estate sector in 2011, the group has today evolved as a think-tank on the sector with specialized research reports and rating & ranking. We are editorially independent and free from commercial bias and/or influenced by investors or shareholders. Our editorial team has no clash of interest in practicing high quality journalism that is free, frank & fearless.
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