Tuesday, November 15, 2016

I visited Leisure Town near Amanora at Sade Satra Nali Gram Panchayat

Booby-traps on the border of Pune Municipal Corporation:


Site Sales Office of Leisure Town near Amanora at Sade Satra Nali Gram Panchayat, Pune 411028

Last 3 years I did my best to avoid visiting Leisure Town at Sade Satra Nali. But this Diwali, I had no option but to visit it. Reason was Abhimanyu Singh, one of my readers in USA.

Abhimanyu was interested in booking a 2 BHK Flat and was very excited about 2 things - 1) the location - behind Amanora 2) the property price - only 60 lakhs. Abhimanyu wanted my views about Leisure Town.

I admire the current generation of flat buyers like Abhimanyu. Like the last generation of flat buyers they give importance to the location of the project. But unlike the last generation they go beyond location and consider other aspects like trust worthiness of the builder, quality of construction, timely possession, sanctions & approvals. Some even consider the environmental clearance! When the flat buyers like Abhimanyu ask my opinion, what they really want to know is whether I have any information about these other aspects.

In case of Leisure Town, Abhimanyu was the first flat buyer who had asked my opinion. Otherwise, in the last 3 years whoever called me was interested in discussing about the payment plan at Leisure Town - own a home without a bank loan - instead of taking a home loan & paying huge interest to the bank - pay property price to the builder in installments - pay 30 per cent down payment + 84 monthly installments + 3 bullet payments. Yes! Like Guardian Developers' 100 per cent interest free homes offer!! That's why I didn't visit Leisure Town in the last 3 years.

When a builder tries to get the bookings by offering some tempting discount offer or an easy payment plan, he is trying to force you to take an uninformed decision. Blind decision. Refusing this tempting offer is like missing an opportunity to own a home. This is pure emotional manipulation of the flat buyers. An unfair business practice. This is not a sale. This is a trap. (Of course, in the last couple of years we have seen that majority of flat buyers became aware about the trap and eventually cancel their bookings!) That's why I am completely against these types of offers & events. Including Leisure Towns' installment offer and upcoming Paranjape Schemes' Options Unlimited on 18th - 20th November 2016.

When it was launched, Leisure Town was a joint venture of 3 builders - 1) Well Wisher Group and 2) Sai Proviso Developers from Navi Mumbai and Tupe Developer of Sade Satra Nali. Then Well Wisher Group retired from the partnership and now only Proviso & Tupe Developers are left. Obviously, the separation had affected the flat buyers.

When a property buyer books a flat - for him getting possession of that flat is a question of life & death. I expect same level of commitment from the builder. Completing the project & giving possession to the flat buyers must be a question of life & death for that builder too. That's why I am against booking a flat at the under construction stage in the project which is a joint venture of 2 - 3 builders and in a project by some so called big brand builder who has multiple on going projects. The fight between the joint venture partners hampers the project badly. There are a lot of projects lying incomplete for years because of this reason. Similarly, the big brand builders with multiple projects are always casual about completion & possession.

Since Abhimanyu didn't mention about 'own a home without a bank loan' offer, I assumed that now Leisure Town may be trying to get the bookings on the merits of the project. On planning, progress of the construction, terms of transaction like property rate protection & compensation for delayed possession, basic urban infrastructure services - water supply - purification - recycling, sewage & garbage treatment provided in the project,environmental clearance, sanctions & approvals etc. I was visiting Leisure Town to get these details from the salesperson and express my views based on that information.

Guess! What would have happened at the sales office of Leisure Town? Did I succeed in getting the complete info?

The lady asked me the usual opening question - What is your requirement? I said - 3 BHK. She opened the presentation. Told me about the D P Roads which offer great connectivity, talked about advantages of being near Amanora, showed the layout plan and the particular building which had 3 & 2 bhk flats, showed the floor plan of a 3 bhk & 2 bhk flat and gave possession dates. When I complimented for her presentation skills, the lady told me that though she had joined Leisure Town only 3 months ago - but she is working in real estate for years.

Now, it was my turn to ask the questions. I asked her about the environmental clearance. She left the cabin and returned with some papers. "It's N A Order - not EC!," I said. "Don't worry. After the booking - I will give you a file containing all papers," the lady said. I realized that the lady is truly experienced real estate salesperson.

"What about 84 installments offer?," I asked.

"That is over. Now we have a new offer. Since we launched this offer - in the last 2 months we have received 33 bookings!," pointing at the property price list the lady said.

"We are giving nearly 7 - 10 lakh rupees discount! No government charges - No stamp duty - no registration charges - no service tax - no VAT - instead of 97,76,100 - you have to pay only 88,20,00 for a 3 BHK!," the lady said.

"WoW! And how much for a 2 bhk?," I asked.

"Instead of 67,59,450 - only 60,90,000 and instead of 66,60,000 - only 60 Lakhs!," the lady said and added - "Not only that! We have 10 - 70 - 10 - 10 offer!," the lady said.

"What's that?," I asked.

"You pay 10 % at the time of agreement - then HDFC pays 70% - then you pay 10% and at the time of possession HDFC pays last 10%!," the lady said.

"WoW!," I said.

"What is the rate?," I asked.

"Only 6,000! You know what is the rate at Amanora? 8,000! You won't get a 3 BHK in 88 lakhs in Amanora - though it is just behind our compound wall!," the lady said.

The property price list said that the basic rate was Rs. 5,300 + 700 per sq ft for Infrastructure, Development, Clubhouse Etc.!

"What are these 700 rupees per sq ft for?," I asked.

"Look - it's written here - for - Infrastructure, Development, Clubhouse etc," the lady said.

"In short - you are giving discount of government charges by one hand recovering that amount by the other hand as infrastructure, development, clubhouse charges," I said to myself. It means that the property rates at Leisure Town have not changed much in the last 3 years - according to Indian Real Estate Forum - in December 2014 rate was Rs. 5,500 and after 3 years, in November 2016, it is 5,300 per sq.ft..

Even after the 3 years - the USP is - near or behind Amanora is the attraction & only available information about Leisure Town!

'Bank on the location & compare the price difference' - is the strategy applied by the all projects on the border of PMC. Western Hills - Bella Casa - Ganga Acropolis on the border of Baner & Sus, Ganga Legend on the border of Bavdhan Khurd & Budruk, Pura Silversands & Godrej Infinity on the border of Mundhwa & Keshav Nagar - all 'bank on the location & compare their prices with the prime projects in the PMC limits'. Naive flat buyers forget that you have to compare apples to apples. Not oranges to apples! Unfortunately only after flat possession when lack of basic urban infrastructure services become a pain in the ass - these naive flat buyers realize that the difference between apples & oranges!

But how can I explain all this to Abhimanyu?

How can I say - "Abhimanyu, it's a booby trap!"

How can I tell him - "Abhimanyu - Don't lit this cigarette - there is a firecracker in it - you may burn your face. Don't sit on that chair - you may fell down - someone has loosened the screws!"

Who knows? Abhimanyu may feel that I let him down by not giving informed unbiased view. He may get upset for expressing my hunch - feelings - guess - suspicion - as an expert opinion.

Was it a right decision to visit Leisure Town?

What say you? Please, share your views in the comments.

Leisure Town near Amanora at Sade Satra Nali Gram Panchayat, Pune 411028 - Photowalk:



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18 comments:

  1. Very well written blog sir. You have put important points of bobby trap for reader to understand how actually it’s trapping your senses and forcing you to take decision which buyer will regret. My experience made me to reach to below conclusions-
    1. Never book any property till all necessary documents are checked by you and your advocate. Don’t blindly follow advocate, keep yourself updated on required knowledge which is pre-req to buy any property.
    2. Check encumbrance certificate, a document which give clear picture of land ownership and dispute on it if any. No document is as powerful as “encumbrance certificate” it give you complete information.
    3. Make a small group to save your hard earned money and try to do group booking. This will help you to make changes in agreement clauses if they are bias and one sided. In long run it will solve many problems in very easy way.
    4. Joint venture project is of great risk as eventually in long run one of the builder are out of project and then progress of project is halted due to this excuse. Making buyer suffer for undefined period.
    Thanks sir for this valuable information :)

    ReplyDelete
  2. My heart skips a beat when anyone says Only Rs.60 L.

    ReplyDelete
  3. Why not wait until May 2017?

    Stagnant sales
    +
    Demonetisation
    +
    RERA is a triple whammy that may change things for the better...

    ReplyDelete
    Replies
    1. Pune builders are already getting chest pain & heart attack. This is what happens when one thrives on looted income. Alongwith builders, several politicians too will go bankrupt, especially those in previous Govt who made thousands of crores in scams.

      Demonetisation: Doctors to CAs working full time in Pune, attend anxious calls-

      At Ruby Hall Clinic, Dr Purvez Grant, chief managing trustee and cardiologist, said that some of the people from the builders’ community were very stressed. “We have been getting panic calls since the time of announcement and anxious patients have been complaining of chest pain and palpitation.

      http://indianexpress.com/article/india/india-news-india/demonetisation-doctors-to-cas-working-full-time-in-pune-attend-anxious-calls-4375747/

      And those who think that lot of money back to banks will reduce interest rates sharply, they are wrong. Banks are saddled with NPAs & already facing liquidity crunch to meet latest Basel norms.

      Bank NPAs crisis worsens, bad loans soar 98% to 6,68,824 cr -

      http://www.financialexpress.com/markets/indian-markets/bank-npas-crisis-worsens-bad-loans-soar-98-to-668824-cr/446772/

      SBI Q2 profit plunges 99.6%
      Gross NPAs cross Rs 1 lakh crore-mark

      Country’s largest lender SBI today recorded 99.6% decline in consolidated net profit at Rs 20.7 crore for the September quarter on account of three-fold jump in bad loan provisioning.

      Its profit was Rs 4,991.70 crore during the same quarter of the last financial year.

      http://www.tribuneindia.com/news/business/sbi-q2-profit-plunges-99-6/321969.html

      Delete
  4. So many years passed & still all approvals are not there, neither even basic infra ? This builder is constructing building or selling bidi standing besides a matka centre ?
    Having multiple builders will gave them excuse to blame each other for any issues arising in project due to their own illegalities.

    "Bank on the location & compare the price difference' - is the strategy applied by the all projects on the border of PMC. "
    - Yes, at the end of the day even the distance between head & knee is around 4 feet.
    Better to rent at Amanora than buy in such projects. Lot of hoarders flats in Amanora.

    "Unfortunately only after flat possession when lack of basic urban infrastructure services become a pain in the ass - these naive flat buyers realize that the difference between apples & oranges! "
    - This happens when buyers are busy with bananas while booking !

    And price has officially fallen from 5500 to 5300 in past 3 years & this can easily further go down a lot. Where are those who say prices only go up due to increase in population, reduction in land space blah blah ?

    "But how can I explain all this to Abhimanyu? "
    - If he is in IT, then lot of Abhimanyus will soon come back to India. This will hammer builders even further as in Pune, IT was major driver apart from hoarders.

    Trump may force Indian IT to hire more US employees
    This would impact margins on Indian firms; reduce offshoring

    Indian IT companies will need to step up local hiring in the United States and move less work offshore putting a strain on their margins, as Donald Trump gears up to take over as the US President, winning the mandate over his anti-immigrant rhetoric.
    Indian IT sector must now brace for further troubled times ahead.

    http://www.business-standard.com/article/companies/trump-may-force-indian-it-to-hire-more-us-employees-116111401221_1.html

    And this one comes from Theresa May Govt post Brexit.
    New UK visa regulations to affect Indians from November 24 -

    Britain on Thursday announced changes to immigration rules – including higher salary thresholds – that will affect Indian professionals and IT companies, particularly those using the Intra-Company Transfer (ICT) visa.

    Indian IT workers account for nearly 90% of UK visas granted under the ICT route, reflecting the growing number of professionals and IT companies based in Britain.
    The changes, announced earlier this year, are intended to reduce dependence of British companies on Indian and other non-EU professionals. They come into effect from November 24, the Home Office said.

    http://www.hindustantimes.com/world-news/new-uk-visa-curbs-to-hit-indians-from-nov-24/story-f2YsXSIRjaXHF502vGhl4M.html

    Real estate is going to crash a big way. The following news & data shows the facts.

    India’s housing sector waning demand -
    Pune launches from 2013 to 2016 has crashed by 77%.

    http://infracircle.vccircle.com/waning-demand-indias-housing-sector/

    No buyers at inflated prices, stay wary of real estate -
    http://www.moneycontrol.com/news/business/no-buyers-at-inflated-prices-stay-waryreal-estate-bhandari_7901501.html

    And this one is the biggest & in-depth amongst all which shows coming big crash in real estate prices.

    The Un-real Estate: The sector that is going to take the biggest hit

    Yashwant Dalal, President, Estate Agents Association of India, believes the recent demonetisation has only brought the spotlight back on an industry that was already slowing down. The money that was rotating had slowed and with this demonetisation, things will only slow down further. At least 30 to 40 per cent of the prices are expected to fall in the coming days.

    http://indianexpress.com/article/india/india-news-india/the-un-real-estate-demonetisation-process-100-500-rupee-note-narendra-modi-black-money-4372286/

    When brokers are saying 40% crash in real estate prices, in actual, it will be far more.

    ReplyDelete
  5. Pune chor builders now have got new excuse to delay projects - no labourers. And since this is beyond their control thing, they can get away in legal loophole.
    Pune builders are going bankrupt, that's why projects stalled, abandoned. This is the price one pays by buying in under-construction flat.

    Shantilal Kataria, president of CREDAI, Pune Metro, told TOI, "The construction industry is facing a huge problem because of labour shortage, which is a fallout of the government's decision to demonetize high currency notes."

    http://economictimes.indiatimes.com/wealth/real-estate/pune-building-projects-hit-by-labour-cash-crunch/articleshow/55557591.cms

    And finally, the real estate crash has now started. Pune prices shall also crash heavily. In news above, Pune builders have admitted they are literally bankrupt.

    DEMONETISATION EFFECT
    Real estate prices crash 50% :

    On being asked to explain why and how the demonetisation had crashed the real estate market, experts said, “Since the circulation of black money has stopped, the unaccounted for money can no more be used in buying and selling properties.”

    http://www.tribuneindia.com/news/chandigarh/real-estate-prices-crash-50/323419.html

    BTW, Ravi did you attend Paranjape builders exhibition held last weekend ? I would like to know why contractors of builder have been paid barely 10% of amount in past 2 years and also the salaries of employees is not paid for 3 months.

    ReplyDelete
  6. Wondering what would happen to salaried class who purchased property through Home loan?

    For Example, lets assume the property worth 65 lacs with 50 lacs Loan at IR of 10-11% for 15 yrs, total payable interest becomes 100% which amounts to total cost of property as 1.15 cr.

    Now coming to Demonetization effect, with 40% correction in 80 lacs(~Assume appreciation in 65 lacs) will pull market price to 58 lacs. Isn't it bad news for people?

    ReplyDelete
    Replies
    1. "Isn't it bad news for people?"
      - That's the price one pays for short sighted big financial decisions.
      When a buyer takes a loan for 15-20 years, he should know that things can go in his favour or not during this time. The risk factor has to be factored into.
      That's why it's said time & again never to take home loan exceeding tenure of 10 years where EMI doesn't exceed 25% of your take home income.
      And if this is not possible, rent & invest the balance money to create a good surplus.
      But people want everything right now. So they take more loans & get trapped.
      So this is bad news only for those who took short sighted decisions as well as hoarders who thought they will double flat price in 3 years & sell making great profits.

      Delete
  7. This comment has been removed by the author.

    ReplyDelete
  8. This comment has been removed by the author.

    ReplyDelete
  9. If you are true, post this link on your blog...i know you won't dare to...

    https://www.indianrealestateforum.com/forum/city-forums/pune-real-estate/13272-who-is-ravi-karandeekar

    ReplyDelete
  10. Is this really not worth to buy 2 bhk in 58? I visited and about to book the flat. please advise.
    Thanks,
    Vinod

    ReplyDelete
  11. I personally won't suggest to buy here, Even though project and location is good, but there are some legal issues with this project. There are disputes going on between land owner Tupe and builder. There were two builders in past but there is only one builder now due to dispute and something is going wrong due to all these things.

    I know some information from one of my friend who has booked a flat here in February last year and has paid more than 80% of the total amount, but he is still not able to register his legal agreement and registration. Builder is saying registration can not be done because Land owner Tupe is not ready to sign agreement due to some unknown disputes. My friend is paying his bank emi's regularly without legal registration being done and he is now trapped and taking legal advice on what can be done in this situation. He is really frustrated as no one is giving right information to him, builder does not give him the right information on what is the dispute and by when it will be resolved. He tried to reach Land owner Tupe, but he also refused to talk saying you have booked flat through builder so you should talk to him.

    My friend is in touch with lot of of other people who are trapped like this who have paid money to the builder but not able to register their agreement since last 8 months because of the dispute and no one is giving them the assurance on when this dispute will get resolved.

    He also mentioned that there is some problem with the parking space and amenities usage as well, he said he was told by land owner that some flat owners won't be allowed to use amenities and won't be given the parking space. There is lot of unclear things about this project.

    I know all these things because I was also interested in buying a flat here through my friend but due to all these issues i have dropped the idea and looking for another project now.

    ReplyDelete
  12. Check on RERA site...project is clear now....worth putting your money

    ReplyDelete