What deters home buyers from newly launched properties?

Today, we see an increasing trend in the market towards ready to occupy projects. To understand further we looked at one of the recent surveys done by Track2Realty across 10 cities. As per a the survey done in ten cities-Delhi, Mumbai, Kolkata, Bangalore, Kochi, Ahmedabad, Chennai, Patna, Pune and Chandigarh  following were some of the reasons why home buyers in India, prefer ready to move in flats. You can read more here.

Possible reasons for preferring a ready to occupy property

• Delay in the delivery is cited as number one reason to book a new launch by almost all the home buyers
• Default in design, construction quality and fear of faulty construction
• Nearly eight out of ten, say they have not got what was showcased as the sample flat.
• Lack of amenities like the water splash as the swimming pool, clubs being no more than cafeterias and under-equipped gyms etc in their housing project
• Home buyers prefer ready-to-move property because they can avail for tax benefits only after the possession of the house.
• Immediate relief on rent and EMI is cited as one of the main criterion for choosing a property worth possession.
• Possible artificial demand in a new launched project and after 12-24 months, prices can be realistic, if not outrightly downward.
• Anxious to make sure who their neighbours would be and the overall community profile of the apartment.

As per our analysis and understanding of the Trivandrum real estate market, most of the reputed builders like Skyline, SFS and Artech who have a history of project completions on time, don't deal with issues 1, 2 and 3 which are the primary concerns for a home buyer.  For new builders one needs to be a little bit more cautious and ask a real estate consultant on their specific requirements from the property and assess if it is the right decision. Areas a real estate consultant can look at include: 1) Financial leverage 2) Clear documentation 3) Approval from banks 4) Contractors who are constructing the project (this could be different from the builder) 4) Getting feedback on existing projects.

With regards to artificial demand, there are examples of that in the market. For e.g when DLF launched its project in Bangalore there was a huge demand for real estate space and then there was a slump which made DLF cut the prices ultimately. However what we find is that real demand truly exists in most places in Trivandrum especially within the city like Vazhuthacaud, Kowdiar or even MG road. Hence an investment with a good builder in an area within the city should allay most of the concerns of home buyers. For those who still have questions should seek help and trusted advice of a consultant.