Don't buy real estate in a flash sale

Discounts could be luring but onus of due diligence is always on buyer

After many websites started selling properties online, Pune-based Amura Marketing Technologies and real estate portal 99acres.com have planned a real estate flash sale.

The event, called as Indian Realty Flash Sale‎ or IRFS, will showcase properties all over India and these will have discounts ranging from 2 – 22 per cent. Interested buyers have to register at www.irfs.in (June 12-25) and the event will start on June 26 and end on June 28.

Most discounts are not straight reduction on the selling price. While some may offer free stamp duty and registration, others would waive floor rise, give fully furnished homes at no extra cost, and provide free second parking.

Vikram Kotnis, Managing director of Amura, say that most buyers are holding on to their cheque books waiting for real estate prices to correct. He thinks prices in most markets have bottomed out and it’s the best opportunity to buy a house.

So, the companies went to developers and asked them to pass the marketing cost to the customers. “Currently, the sales and marketing overhead for a developer ranges from 6 – 12 per cent,” says Kotnis.

Buying a property can be a tricky. In the current market buyers are constantly facing issues such as delays, developers changing plans, asking for extra money due to new provisions, and not honouring contracts.

Narasimha Jayakumar, chief business officer of 99acres.com explains that to avoid such issues, the company has got reputed names with track record such as Tata Housing, Shapoorji Pallonji & Co, Godrej Properties, Kolte-Patil Developers, Shriram Properties, Sobha and Hiranandani Constructions.

Other than brands, the companies have also looked at the permissions realty players possess with regards to the projects and have included properties on which work has already begin. To ensure that the buyers are protected, there will be no money involved when a potential customer selects property online.

Once a buyer shortlists a house, they will need to download a coupon. After the online event ends, users will need to take the coupon to respective developers and book the property. The coupon will be valid for either seven days or until the stock lasts.

But experts say that buyers should not get lured by the discount. Consumers may get a good price but it’s not similar to buying electronics or clothes online. A house is the life’s biggest purchase for most. Experts say that buyers should physically go and check the property and due their due diligence.

In fact, Jayakumar of 99acres.com and Kotnis of Amura suggest that despite they have done their best to put in the safeguards, buyers need to carry out their own checks too.

“They need to take the legal opinion, check whether the projects are accredited by banks, whether the carpet area of the flat meets their expectations, and the compensation a developer is willing to give in case of delays,” says Kotnis.