Affordable housing – need of the hour
In a country like India affordable housing shall soon be the greatest concern of urban development authorities, municipal corporations, and governments. About 40 percent of the country’s population lives in urban tracts and negotiating affordable residential properties can be quite an ordeal for the ordinary buyer. Real estate booms and artificial hype have put the dream of owning a house quite out of reach. Affordable houses for the typical Indian family is likely to cost anywhere between INR 25 lakh to 60 lakh depending on the rate (per square feet) of the locality, the facilities offered by the project, the reputation of the developer etc.
If you are starting to think that your dream home may stay unaffordable, read on. Here are some expert tips to getting the price down on a prime property. As with most buys, research is a key component of negotiating affordable houses between INR 25 and 60 lakhs. Once you have done your research it makes sense to reach out. Most property portals such as Magic Bricks and 99 Acres have forums for people from specific cities and localities to ask and answer questions. Often real estate experts answer queries too. Here are four important tips to find that affordable dream house you’ve been looking for.
• Pick the right locality
This might be the most important thing you do in your attempt to buy your new house. In each metropolis you shall come across pockets which despite their excellent connectivity and location come rather easy on the purse than others. In Delhi, for example, areas such as C R Park, Vikaspuri, and Janakpuri may have just become unaffordable for many potential house buyers but localities such as Lakshmi Nagar and Uttam Nagar offer great value. Even India’s most unaffordable city, Mumbai, has budget friendly options with developing infrastructure and great connectivity. Areas such as Navi Mumbai, Goregaon, and Chembur are all places you may want to consider in Mumbai.
India’s IT hubs have become notorious for their unaffordable real estate prices. It is, however, a bit of research that can help you unearth the best places to look for in terms of value and connectivity. In Pune, for example, Dhanori, and Wagholi are best suited for a budget between INR 25 and 60 lakhs. If you are willing to take on a slightly longer commute, Hadapsar is a good choice too. Kengeri, Chandapura, Electronic city phase II are all great areas to consider if you are looking for affordable housing in Bangalore.
• Collective buying of property
Collective buying or group buying is not a new concept. For decades now, buyers of different products and services have collectively approached wholesalers to obtain their needs at a discounted rate in comparison to the price a retailer may charge them. The dynamics of demand and supply are quite the same in the real estate market. Collective buying adds an entirely different colour to property negotiations. It offers the property developer and builder a real chance at dramatically increasing occupancy at the close of one deal. Developers/builders are often cash strapped and closing such a large deal may do wonders to their credit ratings. One of the great reasons real estate developers look forward to group buyers is that it cuts their marketing and advertising cost considerably. Now, where does all this profit go? A good deal of it is passed on to the property buyer. It is not uncommon to get from 15 to 20 percent discounts on group buys.
Now if you are wondering where to find buyers who can group in with you and are interested in the same city and locality as you are, the Internet is a pretty good place to start. While the idea is new, a number of websites such as Home Buyers Combine, Group Home Buyers, Discounted Flats, Group Bookings, GrOffr etc. are now making a mark in India. Log on into any of these sites or use the power of Social Media to find buyers in your city to form a strong group.
• Negotiating better
If there is one set of skills that you must hone to be able to secure your dream home, your negotiation skills would be it. Here are some tips to get you through the deal.
Express Interest – One key mistake most home buyers make is feigning disinterest. In the case of real estate, stakes are high. Information seekers and snoopers often approach builders and developers much more than real buyers. Expressing interest in a property marks you out as a genuine buyer. The developer will stay keen to close the deal too. Do carry your cheque book to the negotiation table showing willingness to pay a token amount if the talks succeed.
Pre-approved home loans – Getting a pre-approved home loan is another great way to show your genuine intention while you shop for your dream house. A pre-approved home loan is merely a confirmation from your bank that it is willing to go ahead with your loan process. The idea of a full payment, however, is likely to get you any discounts the developer is willing to offer.
Stay calm and focused – Some of the greatest failures on the negotiation table result from inattention and ego. Research the developer/builder before approaching the negotiation. Do not let ego, or a heated words get in the way. Stay polite and calm and observe common courtesies.
Walk Away – This could be a tough one but it is sometimes necessary to walk away from a potential deal. Remember, there will be other opportunities. It is always better to walk away than enter a financial deal unsuitable and disadvantageous to you.
• Broker deals
Real estate deals are often managed by brokers and middlemen. To deal with them it is necessary that you get to the core of the issue and meet the sellers rather than understand the reason for sale from the broker. Besides, offering the seller’s broker an additional commission for a much larger cash discount should be your strategy.