Posted on 26 April, 2024 by Sugee Group
Property purchase is a one-time occasion for many home buyers as it often involves investing one’s lifetime savings into one decision. Home buyers enter property investment with hopes, dreams and a fixed timeline in mind. But when construction deadlines are not met by the developer, it results in disappointment on many fronts, especially for the end users who had planned their home-buying journey.
However, changing market dynamics, rising awareness and regulation in the form of the Real Estate Regulation and Development Act (RERA) have turned the tide in favour of the customers. To protect the interests of home buyers, the new RERA regime has made delivery of homes a measurable target with no space for any ambiguity about the timelines. Real estate developers are under constant scrutiny and must fulfill their assurances to ensure timely delivery of the projects or face severe penalties.
While the real estate market has more or less stabilised with RERA coming into play, according to a report from 2022 with data provided by MahaRERA, the largest chunk of lapsed real estate projects in Maharashtra are in Pune and Mumbai with 1,216 and 649 projects respectively. These lapses affect the end user who has to face the consequences for the delays. Along with loss of trust for home buyers, delayed project delivery often leads to the burden of EMIs and disrupted life plans.
Double Whammy of Rent & EMI
The biggest pain point of home buyers investing in under-construction projects has been missed construction deadlines and delayed possession timelines. Customers are liable to pay EMIs on the interest of their home loan for several years. This load is doubled for those who stay in rented accommodation. The two-fold burden of rent and EMI can be difficult to bear when a project is delayed and homes are not delivered on time. Rising inflation and increasing interest rates also impact the size of the EMI, increasing the financial burden on home buyers.
Delayed Life Plans
People buy homes for several reasons ranging from a growing family to a job change, or simply the desire for a new and larger space. When the possession of this property is delayed, it has a domino effect on their life plans and future goals. The impact of missed deadlines is felt not just by the individual home buyer but also by their entire family. From deciding on the location of their kids’ schools to their workplace travel, everything is disrupted. Every single month of delay leads to more uncertainty and frustration for them.
Complex living arrangements
Delays in project delivery often compel home buyers to make alternate living arrangements for a longer duration than expected. They are forced to stay in temporary accommodations or sometimes inconvenient scenarios such as cramped apartments with extended family or friends. This might mean squeezing into a relative's already crowded apartment, putting an extra strain on relationships and personal space. They might have to continue adjusting to the rising costs and lack of amenities that they were looking forward to in their new homes.
The RTMI effect
Due to the uncertainties among home buyers & trust deficit for under-construction projects & delivery timelines, they end up opting for RTMI projects. This also means missing out on the financial advantage of under-construction projects whereby one gets an option of planning their finances with a flexible payment schedule offered by the developers. Additionally, with under-construction projects, one has a wider selection of apartments and floors to choose from, allowing them to find a space that perfectly suits their needs and preferences. However, the prevalence of delay makes many aspiring home buyers hesitant to take advantage of these benefits, sacrificing affordability and choice for the security of an immediate move-in apartment.
Impact on Customer-Builder Relationship
There is a lot of anxiety around investing one’s lifetime savings in a real estate project. When developers deliver projects on time, it's more than just meeting deadlines of completion. It is a brick laid firmly in strengthening the foundation of trust amongst your stakeholders. Home buyers see it as a promise kept, demonstrating the developer's reliability and commitment towards them. This builds credibility, not just for the current project, but for future endeavors, attracting buyers who value dependability and reliability.
On-time Delivery: Positive Impact on Real Estate
The real estate sector is evolving at a rapid pace and this is clearly evident with the expectations of home buyers along with the improved track record of developers. The growing number of timely delivered projects is gradually changing the perception of the property market as a bankable and lucrative investment class amongst others. With reputed developers maintaining a healthy track record of project delivery, their competitors are also honouring project timelines thereby creating healthy and professional practices for the entire sector. Building a culture of timely delivery not only benefits the home buyers but also other stakeholders thereby creating a conducive ecosystem for the long-term stability and growth of the real estate sector.
At Sugee Group, we completely understand the essence of on-time delivery, especially from a home buyer’s perspective hence, we strive hard towards completing all our projects on time. Functioning with the same assurance we have a track record of delivering all our projects on time since the past 35+ years.
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