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5 factors that should decide your home purchase

A lack of choice or awareness makes people buy the best homes in bad localities. Seek the right information about your home first.
by Reyna Mathur

If you are on the lookout for a new home, first tell yourself this: what is on the outside of the home is sometimes more important than what is on the inside.

For, you can always renovate your home and set that leaking ceiling right with expert guidance, but how can you change an unfriendly neighbourhood, or the lack of a grocery store in the vicinity, or your child’s school being 5 kilometres away from home? Hence, it is important to take into account certain factors that should influence your decision to buy or rent a house in a certain locality. These are:

The house itself. You can sense the vibe of a new place the moment you step into the house. The house itself will welcome or repel you, and you may not always be able to explain why. However, go with your instincts – does the house feel right on entering it, or does it have a cold vibe that disconnects with you? Don’t purchase a house just because the price fits your pocket.

Also, examine the house thoroughly when you take a tour. All faucets, electrical appliances, plumbing utilities, etc should be in good condition before you take possession of the house. If you are being short-changed on the maintenance of the house before you move in, you will have to be firm about getting the situation rectified. Else, seek another house that will give you value for the price.

The neighbours. It is not enough to merely fall in love with a house in a certain building, even the neighbourhood should be a good one. Some building societies actively discourage single people or persons of a certain religion from buying or leasing flats, so even if you want a house there and have the money to purchase it, you will not be allowed to (if you fall under these categories). At other times, immediate neighbours are not very welcoming towards new families or couples. Though this cannot be a reason for you to not opt for a dream house, you will have to work extra hard to change your neighbours attitude towards you. If you are the sensitive sort, unfriendly neighbours will cause you unnecessary stress, so examine your own feelings on the subject before you proceed.

The locality. Take a walking tour of the locality where your dream house is located. All grocery shops, the milkman, paper delivery agency, the dhobi and even vegetable vendors should be within walking distance from your house. A chemist shop in the vicinity is an added bonus.

If you are married and have children, find out where the nearest playschool, secondary school and college is. Ideally, your child should be able to walk to school daily instead of relying on transport. If the school or tuition classes are far away, see if the roads are safe for your child to ride a bicycle or scooter on.

Entertainment spaces. People don’t just come home from work and sit in front of their TV sets, though a large number of people actually do that. However, it may be because Mumbai does not have too many open spaces or gardens where people can hang out in for recreation. Explore the area and be on the lookout for open grounds and gardens where you and your family can unwind after a hard day’s work. Alternately, look for the nearest shopping mall to spend an evening in watching a movie or just chilling with the family. Besides this, there should be a public library, a DVD renting library, a good restaurant and spaces for you to hang out with people our own age, such as a book club or cooking class. These spaces are most important, especially if your house itself is quite small – you might not enjoy being cooped up at home always.

Well maintained emergency utilities. This is hardly a consideration for many people, but in Mumbai, where building collapses and fires are imminent; there have been many cases where fire brigade tenders have been unable to enter narrow access lanes to provide assistance in a disaster. When you make a tour of the property, walk around the building to see if the society has ramps for fire brigade trucks, a service staircase in good condition, a well maintained front access road, and a functioning fire lift and apparatus in the building. Examine if the building lifts are in good condition. The absence of any of these amenities should instantly raise a red flag in your mind.

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Builders go for broke to sell empty flats

Interest free finance, free electrical appliances on booking the flat, free building amenities…builders are trying every trick to entice buyers.
by The Editors | editor@themetrognome.in

For most Mumbaikars, buying a home is a once-in-a-lifetime task but due to a lack of budget and high prices of properties, it becomes impossible to buy a house without taking a bank loan. This brings in the dreaded EMI nightmare.

Elsewhere, too, the situation is no different. India’s other metros are also seeing a high increase in realty prices, pushing buyers to borrow from the bank to finance their home dreams. At the same time, there are many unsold housing units lying vacant all across the country. Thus, developers are coming up with innovative ways to attract buyers into investing in under-construction and ready possession flats. The biggest indicator of a slump in real estate is the scores of advertisements that developers put out in popular media – as is happening in the metros at the moment.

A builder in Delhi recently announced a ‘no pre-EMI’ clause till possession of the property. Customers are asked to pay 10 per cent as the booking amount, followed by 80 per cent of the amount within 45 days from bank funding. The remaining 10 per cent can be paid on possession. In effect, all the EMIs on the housing loan taken by the buyer are paid for by the builder and the buyer starts paying EMIs only after possession.

Earlier this year, for its upcoming commercial project, another leading builder from Chennai provided an option where consumers paid 40 per cent in three months and took possession of the house, while the balance was to be paid in 15 months. This move pushed sales of commercial premises substantially.

In Mumbai, the developers helming a housing project in Goregaon East decided to offload a series of their unsold flats in Goregaon with a ‘Ready Possession’ clause. The buyers do not take a home loan for the property, and can immediately move in after paying a small percentage of the total cost. The balance can be paid in EMIs to the builder directly, without an additional interest being charged on the same.

Says Dilawar Nensey, Joint Managing Director at the firm, “Since the realty market is down we thought of working out a way for people to be able to buy their permanent dream home as also offload our inventory. We prefer to pass on price benefits to our customers rather than pay heavy interest burden on term loans.”

Another builder in Thane has just announced a housing complex that charges customers as per construction costs, minus the profit margins. “This brings down the cost per house, so more people can buy houses,” the developer explains. Yet another developer in Thane is promising free household appliances like refrigerators and TVs on booking the flats.

But are buyers really buying?

“I am always sceptical of these ‘Ready possession’ claims,” says Shyam Borkar, an architect. “Maybe it is because of my perception that builders are not to be trusted blindly, but I always feel there must be a catch somewhere.” Shyam is about to close a deal on a flat he has booked in Navi Mumbai. “I purchased a re-sale flat because one can never know when the builder will stop construction on a project,” he explains.

Raja Mathur would agree. The garment exporter invested in an under-construction property in Goregaon three years ago, but the work was stalled mid-way owing to permission issues with the BMC. He says, “There is no clarity on when the work will start again and the builder has stopped responding to our calls and messages. I have paid almost 40% of the cost but I don’t know when the project will be completed. I wish I had waited and gathered enough money to invest in a re-sale flat.”

Always examine what the builder is promising, cautions Deepak Vaidya, an investment banker. “Many flats are lying unsold in the city and builders are getting desperate. Some of them will go to any extent to offload the flats. But one must be careful about believing their claims of interest-free payments, paying after possession, etc. They spend crores of rupees on their projects, why will they let the customer use the houses without recovering the cost?”

(Picture courtesy www.topnews.in. Image is used for representational purpose only)

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Works your building society must carry out

There is no excuse to not carry out regular repair works – insist that your building society carries them out.
by Dipen Tewari

The building you stay in collects monthly dues from you in lieu of maintenance charges, lift charges, parking fees, open space maintenance, amenity maintenance etc. This money collected goes into the society’s coffers, and is to be used in times of repair work and painting and plastering jobs.

However, many buildings default on carrying out these repair works. As such, they do not have the option of not conducting safety and structural audits (especially for old buildings) and getting the premises repaired every five years, since they are legally mandated to do so. Many buildings even fail to furnish receipts of the collected money, and do not even hold obligatory general body meetings to discuss the need to increase charges and other matters of common interest.

Apart from these, building society managing committees also have other important obligations:

Intervene in disputes. If a house is affected by leakage from the house above, and the second party refuses to carry out repairs and painting to provide relief to the first, the managing committee must intervene in the matter. They can call for a special meeting for members to air their grievances face to face, and ask the offending parties to rectify the situation. The committee performs an important arbitrator’s role in this way.

Stop unauthorised repairs. Some members may decide to knock off important construction elements like columns in their houses. This is the number one reason for building collapses. As such, members are required to inform the committee of the nature and extent of repair work they are about to undertake, and the committee is legally bound to object if the proposed work will endanger the overall structure.

Conduct regular repairs. As buildings age and face wear and tear, it is necessary to optimise their overall life by carrying out periodic repairs. These may be as simple as re-plastering and repainting the external walls, or as tedious as replacing crumbling water lines and sewage systems for the entire building. The building is duty-bound to conduct necessary repairs, spanning from rebuilding broken compound walls to replacing old tube lights in the premises, to getting the water tanks thoroughly cleaned at least once a year.

Initiate action against defaulters. Some members of the society regularly default on their monthly dues to the building, for various reasons. The committee is fully empowered to initiate proceedings against such errant members if they do not respond to written intimations or pay up the dues within 30 days of being informed to do so. The committee can approach the Registrar of Societies for redressal in the matter.

Maintain essential services for the building. It is the managing committee’s job to ensure that water and electricity are being provided to the society without interruption, that garbage collectors go to all the flats in the building and dispose off the trash safely, lifts are running smoothly, the swimming pools are cleaned periodically, that gardens and potted plants in the premises are being trimmed regularly, and that no stagnant water is collected in the building’s open spaces, among other duties. The committee must maintain a log book of all service staff such as the building watchman, garbage collectors, plumbers, electricians, construction and repair staff, etc.

Cannot take decisions without members’ consent. The managing committee cannot take financial and other decisions for the building premises on behalf of the members and without consulting with them via general body meetings. Similarly, the managing committee must change every year via a fair election process. Some societies levy arbitrary charges for parking, or increase maintenance charges without adequate reason or notice. Members can refuse to comply with any diktats that have not been arrived at after proper consultation with all residents.

(Pictures courtesy www.indiamart.com. Image is used for representational purpose only)

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5 tips to ace your cocktail party look

Fashion designer Monica Garg dishes out the secrets behind putting together a good look for every kind of cocktail party.
Monica Garg Director International Luxury Academy (2)
Monica Garg

One of the trickiest things is to choose the right dress for a cocktail party. Though there are no fixed dress codes for such events, you do not want to end up under- or over-dressed. Start by finding out the nature of the cocktail party – this will help you decide on the acceptable dress code.

1. Cocktail parties are normally formal. Conventionally, the appropriate dresses would be those which are mid-thigh to knee length. You can always try a little flirty cocktail frock, metallic embellishments, cropped jackets, embellished tops, slim black pants, and black party dress teamed with metallic pumps. Whatever you choose to wear for the night, do not forget to jazz it up with an eye catching handbag and statement jewellery to complete the look.

2. Do not hit cocktail parties in tailored outfits, or dull corporate clothes teamed with day bags. You might end up being out of sync with the rest of the crowd.

3. If you don’t have time to buy a new dress, mix ‘n’ match the dresses that you already have in your wardrobe. You can combine a skirt in a solid colour with an embellished top. If you have to go directly from office to the party, just nip in to the ladies’ room and exchange your suit for something more glam, such as a sequinned tank top.

4. If you are headed to a dinner party, you can choose from either Indian wear or Western clothes. You can choose harem pants, printed tank tops, or solid tops with ankle boots for your friends-only dinner party. You can also try a flowy dress with a leather jacket, dark skinny jeans, chiffon maxi dresses, pumps, chain bracelet, beaded sandals teamed with cocktail rings and chunky necklaces.

5. It is always a tricky balance between under-dressing and over-dressing at formal dinner parties. To be on the safer side, set aside a pair or two of funky earrings or scarves in your bag to change your look at the last moment, if need be.

Monica Garg is the Director, International Luxury Academy, Delhi.

(Picture courtesy creativefashionglee.com. Image is used for representational purpose only)

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Houses get smaller in Mumbai

Unable to sell large apartments in a sluggish market, developers are shrinking the sizes of houses while not reducing costs.
by The Editors | editor@themetrognome.in

Since nobody is buying houses in Mumbai and other cities, developers have hit upon a better idea: sell smaller homes. But don’t go running away with the idea that these smaller homes are more affordable. Their per square foot area rate is still unchanged.

As per JLL India Research’s latest report ‘Is Indian Real Estate Heading Towards A Tectonic Shift?’, ‘among the major trends is how developers have been decreasing apartment sizes to suit affordability of buyers.

‘Builders are exploring innovative ways to make residential housing across major cities more appealing to potential buyers at a time when it is increasingly becoming difficult to sell expensive apartments. Unable to sell expensive homes in a sluggish market, builders across India are making smaller apartments without lowering the price per square feet and compromising on the quality of product. In the last five years, average apartment sizes are falling across all major cities of India.’

The report details the Shrinking House syndrome in Mumbai thus: ‘Mumbai Metropolitan Region (MMR) – including Mumbai, Thane and Navi Mumbai – witnessed the maximum fall in apartment sizes on annualised basis, along with Bangalore, Chennai and Kolkata. Other cities also witnessed varying degree of fall in median apartment sizes.’

As per the report, Mumbai, which ‘already had smaller and compact apartment sizes compared to other cities, saw a decrease of 26.4% in the past five years.’ The report adds, ‘The dynamics of apartment sizes have a tale to tell – that developers are paying conscious attention to consumers’ requirements. The fall in average apartment sizes across all top seven cities [in India] is a clear indication that developers intend to make houses affordable for buyers by reducing average apartment size instead of reducing the capital values.

‘While property prices are not purely a product of developer’s discretion, the decision to alter apartment sizes as per the needs and spending power of buyers is definitely within their ambit.’

Read more about this trend on JLL India’s blog.

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Who is buying flats in Mumbai?

Despite developers’ many claims of ‘sold out’ projects, Mumbai’s real estate market is still in a continuing state of stagnancy.
by Reyna Mathur

Any major newspaper in Mumbai these days normally carries a full front page advertisement for yet another ‘dream housing project’ in the city limits or on its outskirts. Big or small, most real estate developers are advertising for their upcoming projects like no tomorrow, spawning theories that the city’s real estate sector is finally out of trouble.

However, experts are divided on the issue, and on-ground realities say otherwise. Despite aggressive advertising and appearances at property fairs, developers are finding it difficult to sell already built housing units, or get customer interest in new proposed projects. Each year, property prices are continuing to rise, making it virtually impossible for first-time buyers to even consider purchasing a property without the burden of large home loans.

Add to this the fact that several pockets of Mumbai – which were earlier considered a solid investment – are now simply saturated, having hit the boundary for growth. People then started considering the northern suburbs beyond Borivali, but with an overall slowdown in the industry, even these houses are not yielding the kind of returns they normally would.

A departure from earlier investment patterns

A common-sense approach to investing in houses is to select a site that promises future growth, and hence a doubling of the initial investment. Another way is to invest in under-construction houses so that payment instalments are easier on the buyer. However, cases of developers abandoning projects mid-way in the recent past have scared off potential buyers.

Another problem plaguing the real estate sector in Mumbai is the lack of implementation of planning and building norms. These cause huge hassles at a later stage, when builders seek OCs (Occupation Certificates) and CCs (Completion Certificates) which the BMC does not furnish on finding that several norms have been flouted in the construction process.

A lean period like never before

The first signs of a crash in the city’s real estate market came with the worldwide economic recession of 2008-2009, when prices crashed dramatically. However, a year later, the sector consolidated and made good on its losses, but elsewhere, inflation and rising prices made buyers and investors think twice before taking the plunge. Interest rates on home loans also started climbing post 2010, and have continued to climb since.

All of this resulted in a curious ‘more supply, less demand’ scenario for housing in Mumbai. What was expected to be a ‘drought’ period of about three years has now extended to seven years.

Even the big developers are hit

Only major names in the real estate space in Mumbai, and indeed the country, are doing somewhat good business currently. With their strong market presence, they are able to not just generate more projects but complete the ones in hand. Yet, experts say that it is becoming a tough task even for these moneyed developers to sign up for new townships – there are no huge tracts of land now available in Mumbai, and the lands that are available are caught in a maze of reservations, permissions and modified Government policies.

The major projects currently underway in Mumbai, however, seem to cater only to the wealthiest sections of society, with each square foot of built space being sold upwards of Rs 50,000 or more (depending on the area of Mumbai).

The most badly hit are the middle-level developers, who mainly rely on small redevelopment projects or single-tower projects for business, and which are currently not forthcoming. With them are hit the middle classes, who are actually in need of housing but are forced to either move out of Mumbai or spend money every year on rental accommodation – even as their eternal quest for a house in Mumbai continues!

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