Price hike between Rs 50 and Rs 400 from April 20:We all, including HDFC, were talking about Pune real estate slow down. Everybody was sure about property rates in Pune will come down. But on 10th of April, Lalitkumar Jain, president of Promoters and Builders Association of Pune (PBAP), made a shocking announcement.
PBAP, association of all most all major builders in Pune, (yes, SRK Developers, promoter of OvalNest 5 Star Homes at Warje is not a member of PBAP) has decided to increase the per-square-foot rate of flat between Rs 50 and Rs 400 from April 20.
DSK and Felicita - Baner:Flat buyers gave instant response to DSK's ads about price hike. As if it's Petroleum Minister's announcement. No, they did not stand in the queue all night waiting for D. S. Kulkarni Developers' office to open on Ram Navami but all 50 flats were booked in no time. Even Felicita - Baner got a great response to their offer to book a flat before 20th April. But, surprisingly, most of the builders in Pune and important members of PBAP did not announce any price hike or the offer.
Shantilal Kataria, Vice President of PBAP:Has PBAP dropped the idea of officially and unanimously hiking the property rates in Pune? Angry first time home buyers in Pune and/or 1 lakh vacant apartments in Bangalore forced the builders to reconsider their decision or what! But i did not see any point in jumping to the conclusion. So, i called Shantilal Kataria's office. For the first time, since i started this blog.
I was sure, Mr. Kataria is the right person. Not only because he is the vice president of PBAP or Aditya Builders is one of the big builders in Pune but because Shantilal Kataria, i believe, is the think tank of Pune builders. At the same time, for more than 25 years Aditya Builders has developed schemes in all parts of Pune only for the middle class. Naturally, as a good builder, Shantushet, as he is affectionately called, can read the mind (and bank statements!) of middle class of Pune as if it is a balance sheet of his company.
Price hike - Under Protest:In the last 3 months, cement and steel rates, hiked labor charges, increased operating costs because of the inflation and Pune Municipal Corporation's increased premiums have increased the construction cost. This has forced the builders to increase the booking rates of the flats.
Since the property price hike is due to the increased construction cost each builder has to calculate cost increase on the project to project basis. Depending upon the stage of the construction, builder will increase the booking rate for that scheme. Suppose, the construction is in the last phase, a builder would increase the rate for that project, only by 50 rupees. Recently launched or where construction is still at initial stage price hike can be maximum.
How and when to increase, at one time or in phases, is an individual builder's choice but to construct and complete the project there is no option for the builder but to increase the property rate.
Shantilal Kataria explained the reason behind the delay in declaring the price hike but made it clear that Pune builders are going to increase the property prices. He also told me that builders are not happy about this decision.
Pune real estate slow down:We were talking on the phone. To me, Shantilal Kataria sounded quite comfortable about the price hike. He was confident about the bookings at hiked property rates. Of course, i was expecting this. Still, he was not talking for himself. PBAP has discussed this in the meeting and Shantilal Kataria was talking to me on behalf of Pune real estate developers. Was he really comfortable and confident? Or is it a determination to hold the fort and present a strong position to Foreign Direct Investors?
What do you think? Would builders hike the rates as announced? Would you give up the hope of real estate prices coming down and book your 2 bhk flat at hiked rates? Please, let me know in the comments.
Tip: If you could manage your anger and disappointment, you can express your thoughts well. Please, try!
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