Five ways to check a builder’s reputation

Monday, May 19, 2014

If you are planning to buy a property under construction, don't just go by the brochure claims. A lot depends on the builder's competence and resources. ET lists some checks before you finalize a project

1. Groundreport

You can conduct a quick Internet search by keying in the company name since customer forums, blogs, news reports, property sites, etc, typically have a lot of information. However, it is still a good idea to go in for field research. Talk to customers who bought units in old projects as well as local brokers. The current market price of the past projects in comparison to peers in the same locality is also an indicator of the builder's standing. You should check the credentials of the contractors associated with the project as well.

2. Trackrecord

It is safer to buy from an experienced builder with a good delivery record since he is likely to have a more professional approach, with systems and processes up and running. Besides, you can check his track record and find out how well the past projects have been executed. Remember, lack of transparency is a good enough reason to not buy. A reputed builder will also typically be a member of an industry association, such as the Confederation of Real Estate Developers Association of India (CREDA),or the Builder's Association of India (BAI). These are self-regulatory bodies that have strict norms for builders and any deviation may lead to the company being blacklisted by the association

3. Qualitycertificate

The International Organization for Standardization's 9001:2008 certification criteria for a quality management system is based on eight principles, including customer focus and satisfaction. Therefore, an ISO 9001:2008

audited and certified builder is expected to be more professional in his approach, and it is a good idea to check this before zeroing in on a housing project.

4. Realty ratings

Started in 2010, the CrisilBSE 1.29 % Real Estate Star Ratings (Crest) provide cityspecific assessment of real estate projects, and can help you compare and identify quality projects in a particular city. They also have a National Developer Ratings list, which rates a developer on parameters such as good track record of transfer of clean title, maintaining legal and construction standards, and timely project completion. However, the developer has to register with Crisil to be rated and not many projects are on its radar yet.

5. Financial stability

Is the company overleveraged? Get hold of the company's balance sheet, and if the business has too much debt or is unable to repay its loans, strike off the project. Some listed builders put up their financial details on

their websites. For others, you can contact the concerned Registrars of Companies (ROC) office. The Ministry of Corporate Affairs' website (Mca.gov.in/MCA21/) also has the details. Log on and register yourself to view all company documents under the 'view public documents' section. The site will ask for information like company CIN/FCRN, registration number,ROC details, which should be easily available with the company, or you can run a Google search. Also, check the cash flow statement (not income statement). Companies with strong cash flows are likely to complete the projects on time.

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New government: Home prices may not rise immediately

While the the stock markets, the corporate world and a large section of the country's citizens are celebrating the election verdict, 45-year-old Shailesh Singh, a Delhi-based executive, is a worried man. Singh has been hunting for an apartment in the National Capital Region (NCR) for the past six months but has not been able to zero in on one. Now he is afraid that in the euphoria generated by the Bharatiya Janata Party's (BJP) decisive victory, real estate prices may start rising again, making his purchase more expensive.

Why prices won't move up Singh's worries might be premature. Realty experts are of the view that  while there might be some euphoria-driven rise in transactions and a  marginal rise in prices, this will dissipate soon. "It will take another 12-odd months before prices begin to rise within the sector. And that will  happen only if the new government has a successful first six months and its  initiatives put the economy on a higher growth path," says Anshul Jain, chief executive, DTZ India.

One reason why prices may not rise immediately is that they are already very high in most major metros. The economic slowdown has had an impact on salary revisions, and hence on urban buyers' purchasing power. "Economic activity has to pick up and purchasing power has to rise before we see more demand in the housing sector," says Anshuman Magazine, chairman and managing director, South Asia, CB Richard Ellis. High interest rates are another deterrent. "In
the near term, the new government can't down interest rates, especially with inflation reining high," adds Magazine.

Urgently needed reforms While the new government can't engineer a quick revival of the real estate  sector, it can take several steps that would have a salutary impact in the  medium to long term. One, it could expedite the process of granting approvals to real estate projects. "We expect the new government to be more efficient in granting approvals to real estate projects," says Lalit Kumar Jain, chairman, Confederation of Real Estate Developers' Association of  India (CREDAI). Developers complain that the authorities too should be made accountable for not granting timely approvals. But remember that since real estate is a state subject, the central government can at best create a model of best practices for offering quicker clearances and persuade state governments to adopt it.

The new government also needs to get the Real Estate Regulation and Development Bill passed. "By making developers more accountable, the Bill will revive trust in the sector. Low trust in developers' ability and intent to deliver a quality product on time is one reason why buyers are staying away," says Sanjay Sharma, managing director, Qubrex, a Gurgaon-based real estate consultancy. However, some of the harsher provisions of the draft  Bill need to be modified. Currently it says that if a developer doesn't comply with certain rules, he could be jailed. Experts feel that it would be more prudent to punish an economic offence with a penalty rather than treat it as a criminal offence.

 

The slowdown in sales has caused a severe cash crunch among developers, forcing them to borrow from non-banking financial companies (NBFCs), private equity players and private lenders at high rates, thereby making housing more expensive. "Fund flow to real estate from banks and housing finance institutions needs to improve," says Kumar. This will happen only if RBI relaxes the provisioning norms and caps applied to realty lending.

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Emaar MGF accommodating with locational preferences

Monday, May 12, 2014

Property buying decision influenced by various factors, location being top priority for most buyers

: "EVC and MD Shravan Gupta's Emaar MGF"

 

 

 

 

Emaar MGF, a joint venture between Emaar Properties PJSC ("Emaar") of Dubai and MGF Development Limited ("MGF") of India encompasses various aspects of real estate development, such as land identification and acquisition, project planning, designing, marketing and execution. At present, its focus is on the development of residential projects in Delhi and elsewhere in the NCR, Mohali, Hyderabad, Chennai and other key Indian cities.

The location of a property is a primary consideration, and one of the broad choices that help buyers define goals and Emaar MGF has perceived this desire of prospective buyers. The areas covered by Emaar MGF are some of the finest locations surrounded by welcoming green spaces, invigorating fresh air and sunlight; be it in Delhi NCR or other states. This has been the conception of Shravan Gupta (EVC and MD Shravan Gupta's Emaar MGF), Executive Vice Chairman and Managing Director of Emaar MGF whose visionary approach and observance of the changing Real Estate trends led to the astute selection of locations for residential construction under Emaar MGF.

Further, Research has revealed that “Location” has presently become the top most purchase consideration for home buyers. The preference for “Location” is even higher than “Price” which was the biggest influencer for property purchase over the last few years. Emaar MGF’s upcoming projects like Emerald Hills, Palm Hills, Palm Terraces Select as well as Digital Greens are being planned in the Gurgaon region which is highly in demand for residential as well as corporate properties in Delhi NCR. This would especially accommodate with the important shift in behavior of the home buyers who take into consideration the “Location” of the residence, they would settle in. Though, there are several other factors that will influence purchase decision like Price and Connectivity. In fact, around 13% of home buyers give higher preference to the “neighborhood” and proximity of the property to hospitals, schools and offices as well but location of property still remains the top priority.

“Factors such as location of one's friends, family, job and other interests will help buyers choose a general location to begin the search for the right home. Our vision is to become the most admired Real Estate Company in India through meeting the changing requirements while adapting with the latest market trends” says Shravan Gupta (EVC and MD Shravan Gupta's Emaar MGF).

The real estate companies are putting tremendous efforts to match up with the market transitions as well as the ever increasing requirements of the home buyers. While on the part of home buyers, the search for the perfect home requires to make decisions regarding how they would like to approach the process, the markets they wish to explore, and which features they need and want. The property purchase decision is crucial for the fact that large amount is involved in it and thus the buyer being selective over various factors is very obvious.

Related Search : EVC and MD Shravan Gupta's Emaar MGF, Shravan Gupta, Emaar MGF, Shravan Gupta Emaar MGF

 

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