Most Commonly Used Sales Pitches by Developers to Lure New Home Buyers

Written By: Sumita Roy

Most of us know that home sellers/ builders offer a number of plans and schemes to attract home buyers, especially now when the prices of properties have peaked. And it is not that all their promises are pretentious and misleading. There are many people who can confirm that they have indeed benefited from these schemes. 

But how do you know that you can get a good deal from one beforehand, or should you take it as a matter of luck? Well, luck indeed has to do a lot with it. But that does not mean that you do not get to say or do anything about it.

With rise in trend that young people are trying to purchase property early in their life, getting to know the pros and cons of any scheme has become a must in today’s world. In fact their knowledge and understanding of the people can be estimated by the market statistics in Diwali. In spite of numerous scheme launches, discounts and freebies, home buyers were not very keen on purchasing properties due to their already escalated price this festive season.

However, for those who are not aware of the pitches developers quote to engage more and more buyers, here is a list of most commonly used ones.

Price of this property will go even higher than this

One of the first things that a home seller is going to tell you is that property prices are not likely to come down, ever. To be more precise, STOP thinking about the price, go ahead and buy the property. 

However, it is always better to seek advice before making a final decision. Ask the elders and people who have bought property earlier. 

You can also go through the research based articles where property trends are highlighted. Real estate sector, like any other asset classes, have its crests and troughs. The only difference between the two is that these are not as volatile as the stock markets or gold investment, but this is indeed susceptible to slow down and downward trend. In fact in the last two years some of the markets, especially in certain metro cities, have remained stagnant and even have evidenced price dip.

Do not fall in the trap of high rental projections

Most experienced investors have learnt it the hard way, but they have learnt a good lesson, though at a loss of a good amount of money. 

But if you are a new investor, and are willing to purchase a property to rent it out, then you are most likely to come across brokers who will pitch this to you- an assurance of high rental.

With a down trend looming large on the Indian real estate arena, purchasing high rental fetching property requires a lot of insight.

The best way is to consult many brokers and also take assistance from an investor in the same area. It is not likely that people will readily help you out with everything, however, you need to keep trying to extract as much knowledge as possible from them. You can also wait till the market bottoms up.

Correction of price, not in this area

In the recent news we have come across reports that speak of correction of prices. 

But if you mention the same to a broker or any property seller he may ward off the issue saying that this particular area has not evidenced any such correction.

The main reason for such a reply is that though the property in the same area is undergoing correction, but that does not mean that the seller has brought down the price. He can very well quote a higher price to extract as much from the deal as possible. Do not give an answer directly. 

If you know the percentage of correction, calculate the same on your leisure time, quote the price and strike a bargain. You can at least be sure that you have not over paid for the property or have been cheated.

This is the best priced project in the city

Many a time you come across advertisements on newspapers’ first page saying that a project is offering 2 BHK apartments at 25 percent lesser amount than the going price. Don’t you feel like going for the same? 

It would be intelligent to go through the sizes offered, if quoted on the papers. If you get hold of an e-brochure with sizes mentioned in it, you will find that the area of this 2 BHK is far lesser than the general 2 BHK units.

In a report by Jones Lang LaSalle, a property consultant, it mentioned that the average size of apartments is decreasing in metro cities. For example in Mumbai, in the last five years average area of units has shrunk by 31 percent.

Therefore, before going for a property, estimate the area your family needs to live comfortably.

Penalty for delay in delivery

The most problematic of all problems is the delay in construction. It is most unpleasant because it is occurring in almost every under-construction/ pre launch project, and as close to 98 percent of the home buyers are facing the issue.

This is a commonly used strategy to delude buyers in investing in property. By looking at penalty clauses, a buyer feels himself to have a superior hand over the builder in terms of project construction. And indeed, some builders do compensate for delay in delivery, but it is not something you can fully trust.

First, the amount offered as compensation will not be as much as the EMI you are paying. This is for the simple reason that the EMI you are paying is on the total cost of the property and the compensation offered is just on the base price. It will not include ECD, IDC, parking, club membership etc. charges.  And this is for builders who do take pains in offering compensation.

Many builders slip in clauses which prevents them from any claims of property compensation. It is imperative that you go through the agreement and its clauses thoroughly. You should not take their commitment on face value. A compensation of the same should be written down, duly signed by the buyer and the seller.

Property rates revision is soon to occur

Another common trick used by builders to gull buyers into fast purchase of property. It is true that certain areas have undergone revision of rates (like Delhi). However, that does not mean every city will undergo the same process. 

But people with partial knowledge tend to believe when the developers pitch warnings that this is the last time you will get to purchase on the older property rate. From next time the property rates will get revised and you will have to buy at a higher rate.

One thing you need to believe that in today’s market developers are more desperate than the buyers. Overheated markets, rising interest rates and diminishing stock prices have made them vulnerable. Therefore do not hurry on any decision which requires time. And if whatever they say, cross check it in the newspapers or in the internet. 

We offer you your dream homes

‘What you see is what you get’ concept is a charming truce to entice buyer. Builders engage good interior decorators to make a unit ready for display for the clients. They visit the sample flat like it for its internal arrangement which they will not get at the time of delivery.

These sample flats are arranged in such a good way that you start liking the idea of purchasing a unit in the same project more and more, forgetting the truth that you will not get it at the time of delivery. Also sometimes the flats presented on display are more spacious than the one you will have if you purchase one.

Therefore, if the builder asks you to visit a sample flat- first, don’t be overwhelmed with the interior designing; and second, take a measuring tape with you to exactly comprehend the things that your property can fit in, if you purchase it. Also thoroughly check out the walls, doors, fixtures and shelves- are they of good quality and will be able to suit your requirements or not.

Freebies ‘absolutely free’ with property

Purchase a property and get a car with it absolutely ‘Free, Free, Free’. This is the new mantra by chanted by developers in order to bring buyers to the market. 

However, a word of warning: The builder is not offering anything for free. The price of the gift will unalterably be added on with the price of the property.

If you practice a little understanding and intelligence, you will get hold of the current rate of the property in the region. You can also ask in the neighboring colonies about the extra charges- maintenance, EDC, IDC, etc. You are sure to find them lesser than the property rate that is being charged from you. This extra goes into the freebie account.

The logic goes as follows: whether it is freebies, any kind of discounts, or attractive offers, the builder will compensate the deducted amount in one way or the other. They introduce these offers in order to attract buyers in this cash starved market. Sometimes, you will also find that some of these projects are not even approved by authorities.

We have tie ups with banks who will offer loan without any hassle

Tying up with banks is a commonly occurring phenomenon. Yes, builders do have tie ups with bank, but that does not mean you will be offered the best kind of loans through the same. 

It simply means that this particular bank is more likely to approve loan for this project than the others. And neither is it a way to endorse home buying. However, builders use it to get to the common people, who are, otherwise, fretting about their home loans getting approved.

A best rate is something every customer has to negotiate on his own, depending on his capability. Relying on a site person, who may not be even directly connected to the bank, is not the best way to get it done. Also you might be said that the interest rates are about to come down soon- therefore it is the right time to invest property. However, the main decision depends on you.

You can either believe these goons (who may, or may not be right) or can take the pain and go through the financial news of the country. After all, it is your hard-earned money and your dream that will be bought through it. A wise purchase is always suggested, although it may take some time.