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Finding the best property deal online – Do’s and Don’t’s

Submitted by Rubina Rc (@rubina) on Tuesday, 27 January 2015

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Technical level

Advanced

Section

Launches

Status

Submitted

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Objective

Buying home is always tricky as there is no standard way to find fair value of home. This is especially complicated in upcoming area where property prices fluctuate far from one another.

Description

Buying home is always tricky as there is no standard way to find fair value of home. This is especially complicated in upcoming area where property prices fluctuate far from one another. There is clear information arbitrage in home buying process and hence price is not comparable from one project to another. However anybody who is doing fundamental analysis of home buying can convert this problem in to an opportunity to find best deal. Let us see how in this article..

Requirements

Buying home is always tricky as there is no standard way to find fair value of home. This is
especially complicated in upcoming area where property prices fluctuate far from one another.
There is clear information arbitrage in home buying process and hence price is not comparable
from one project to another. However anybody who is doing fundamental analysis of home buying
can convert this problem in to an opportunity to find best deal. Let us see how in this article;

What you need to do to find best deal?

  1. Analyse the builder thoroughly:

It is important to analyse the builder credentials like no of completed projects in the
past, whether projects were delivered on time, no of cities operating. Also analyse
financial position of the company based on recent balance sheet, loan outstanding etc.
Also verify whether any legal, consumer problems on past / completed projects by the
builder.

It is important to understand more about the builder especially not a renowned builder.
Understand personal profile of builder, educational background of management,
architects, contractors, materials used to develop the project. In Porur, an under
construction building collapsed caused death of over 60 people. Major reason for the
accident was usage of bad materials and complete structural defects.

  1. Analyse the project:

Analyse the project in terms of all legal clearances, bank approvals, title documents etc.
Moreover check whether it has adequate amenities required for the location. If it is high
rise building, ensure builder is using fire proof materials and enough space in staircase
and complying with height restriction.

We witnessed in Raheja Vivarea case, non-compliance with height restriction in the
vicinity of airport lead to cancellation of NOC which ultimately put the project in
trouble.

  1. Understand the location:

Thorough understanding of location plays a vital role in deciding the price of a project.
Look at the breadth of approaching roads, ensure there is no slum nearer on the
approach road.

In case of Puravankara highland, the project has narrow approach road and slum on
either sides of road. It became very difficult to access the project though the it has close
proximity to Nice road, metro, malls, major shopping destinations, schools and all other
major connectivity points.

  1. Understand pricing:

Builder advertise basic rate per sqft only on super built up area. However there may be
additional payments to be made by way of electricity deposit, water deposit, club
membership, car parking, VAT, service tax, and registration. Understand the total
budget till registration and ensure whether you can afford by paying from your pocket
as well as taking home loan.

  1. Verify refund policy:

Since you pay money without meeting any person, ensure refund policy and no of days
to get payment back to you if you cancel booking. In various cases, builder will not give
refund unless there is any legal problem in the documents. So understand the nuances
of refund policy before making payment.

What you should not do?

  1. Do not decide without understanding complete terms:

Never be in hurry to buy a home without understanding complete terms of deal. Every
deal may have certain conditions which will impact directly or indirectly.

  1. Not understanding real demand:

Builder may give 15% discount to you. However you may get additional discount if you
show perseverance. Signing a deal without understanding demand for the project will
make you a loser.

  1. Not evaluating other options:

Do not consider any option without evaluating other options. Use auto compare options
to identify similar projects in same location. Also fully understand details of comparable
projects like rate per se ft on carpet area (builder tells rate per sq ft on super built up
area), amenities to be provided, specifications, possession date.

  1. Do not pay two times online:

Sometimes while transferring money through payment gateway, amount would be
debited in your account but you may not get transaction number. So before paying
another time through payment gateway, ensure for the earlier transaction amount was
not deducted from your account.

How RealtyCompass.com is showing bargain projects?

RealtyCompass.com bargain functionality finds out the project which lesser in rate per sq ft (for
particular location and for every property type) for the rating.

You can identify deal from the above picture; projects coming below the line are deals. Any project
which is lesser in rate per sq ft for given project rating is considered as deal.

RealtyCompass.com project rating has sub set ratings like builder rating, amenities rating, connectivity
rating, neighbourhood rating.
You may also want to go through another article which details why lesser per square feet is not always good. Here is the link

https://www.realtycompass.com/blog/real-estate-news/lesser-rate-home-good-buy/

Speaker bio

I am really interested to write and discuss lots of real estate news, trends etc..,

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