The real estate industry has been suffering for the last couple of quarters because of a slump in demand, high rate of interest, and a plethora of environmental and land acquisition issues. Moreover, the global slowdown and European crisis has put a dent in the earnings of most of the companies. Real estate firms are facing a cash crunch because of low sales, increasing inventory costs and higher cost of funds. In the midst of all this, the festive season is here and builders are making it count to boost the demand.
Festival season bonanza for home buyers
In the thick of the festive season, many builders are providing discounts on homes. This is mostly for the benefit of the several fence-sitters who wish to wait and watch. They are convinced that the high interest rate regime and high inflation are here to stay for a few years. These prospective buyers probably have enough funds for their down payment but are reluctant to take the plunge yet. By offering attractive discounts the builders provide them a reason to go for their dream, urging them to make a decision.
In this article, we will discuss the schemes offered by builders on homes. Discount from builders come in many ways.
Cash discount
Cash discount is essentially discount on the price of the home. Mantri developers is offering cash discount on homes. The cash discount will depend on the price and size of the property. The cash discount can be anything between 1% and 3% of the price of the property. This means if a property is priced at 30 lakhs, the cash discount can be anywhere between 1 lakh to 3 lakhs. This is certainly a good amount to save.
Freebies
Freebies are one more option to attract home buyers. Builders are providing freebies with the properties. These freebies can be a car, stereo, installed AC, modular kitchen etc. depending on the price and size of the property. Freebies have been quite an attractive option for some people especially if freebies include cars or electronic goods. Some also offer free parking space along with the property.
Waiver of registration and stamp duty
A few builders have on offer a waiver of registration and stamp duty. The overall discount is about 2%-5%. This is a good amount. A person buying a property worth 50 lakhs will be able to save about 1 to 3 lakhs. Nirmal Lifestyle, a Mumbai firm, is offering such deal.
Group buying in festival season
Companies like Group Booking (www.groupbookings.in) are offering double discounts to home buyers. This works at two levels. Builders provide discounts on their own and also offer a group discount to companies like Group Bookings that negotiate on behalf the customers to obtain more discounts. The builders also find it lucrative because they get a large group of customers without spending any money on customer acquisition.
Note: There are many builders that who offer discounts when you negotiate with them in a face to face meeting. These builders do not advertise in newspapers. Buyers should discuss the possibility of discounts with builders in this festive season. Many of them are open to offer discounts and chances are strong that you are likely to bag a good deal.
Points to note:
First, do your research on the properties. Go for it only when it suits you. Buying a home is your biggest decision and you must be extra careful. Buying a home just because of a 1-2 lakh discount doesn’t make sense if you do not get what you want in a home. Hence think carefully, check the location, builder’s reputation, distance from essential amenities etc. before going ahead with the purchase decision. Opting for a good discount should not come at the cost of convenience.
Second, see if the freebies are really worth it. Many a time, the freebies are useless because you already own them. You should rather opt for cash discounts. You can negotiate on a different set of freebies if you think what’s on offer does not suit you.
The festive season is usually good for shopping because many businesses offer discounts. This year, homes have also been added to the top slots in the discounts on offer list. Use this opportunity sensibly after the due diligence is done.