Mumbai: With the recent hit to the real estate market after demonetisation and rollout of Real Estate Regulatory Authority, developers have resorted to offering several schemes to property buyers in order to maximise their sales. Home buyers are lured by such schemes considering the sky-high property rates and unaffordable housing in the city.
Searching for a dream house, buyers eventually move away from the city towards the suburbs in order to buy an affordable house. Payment schemes such as 20:80 have lured potential buyers. However, real estate experts and property consultants have cited that such schemes are an eyewash and benefit the developer only.
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Speaking to Free Press Journal, Sanjay Chaturvedi, a real estate expert and a property lawyer, explained about the disadvantages of such schemes. “The cost of construction is almost covered under 20 per cent of the sale price which is paid upfront by the buyer. For instance, if a flat measuring 1,000 sq ft is booked according to Rs10,000 per square feet, then its 20 per cent would be Rs 20 lakh. The cost of construction in Mumbai or in any urban area is not more than Rs 1,500 per sq.ft. This means that the developers are taking the construction funds from you in advance.”
Surendra Singh, a flat buyer, said, “We had invested in a project in Mira Road where we had paid more than the booking amount. It has been more than four years, the project has not started. The developer claims that the project is stuck in clearances.” Chaturvedi added that the developers can shut the project at any given point of time after receiving the construction cost.
He said, “The default in possession is rising these days and will continue. Many builders have not yet started their project even after fully sold in pre-launches. In fact, there are times when they utilise the pre-launch booking amount to pay the land lord and clear the project and after that they refund the pre-launch funds to the investors and purchaser saying that project did not get the required clearances from environment or some other dispute in land which never is the case. The simple tactics is to enjoy purchaser’s hard-earned money and return them after a year and two with interest. But who will pay the appreciation?” Experts have time and again advised buyers to learn about the entire scheme related details or rope in a property consultant while investing in such projects.
