5,000 Rupees Tamasha!
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| A huge crowd gathered at the entrance of Happiness Hub |
Sunday afternoon, when I got down from Paranjape Schemes' bus at Happiness Hub, I saw a huge crowd gathered at the entrance.
What's going on? I asked someone.
Angry property buyers had gheraoed Mr. Shashank Paranjape. Mr. Someone told me.
Why? I asked.
People are angry. All flats are booked. How is this possible? The person next to me said.
Really! I said and started crying loudly.
Why are you crying? Mr. Someone asked.
Poor Shashank! Most of the builders are in trouble because there are no buyers. And Shashank is in trouble because there are too many buyers. How fortunate he is. I am crying because I am so happy for him. I said.
Using all my strengths, I tried to enter the crowd. But by the time I reached the center, Shashank was gone. Leaving behind some junior representative of Paranjape Schemes. Who was the target of the angry property buyers.
Let me explain what happened - we had planned to open bookings of only 1,000 flats in the 1st Phase. On Friday & Saturday - itself - all those 1,000 flats were booked. The huge response - was beyond our expectations. How can we stop the people from booking? How can we tell them - don't book all flats on Friday & Saturday - keep some flats available for booking on Sunday - for you all? The junior representative of Paranjape Schemes said.
But - you could have very well announced so in today's newspapers! We would not have come down. One angry visitor said.
Look at this bank cheque! I have driven down only to book a flat. Now, Paranjape owes me petrol & toll money. One angry & disappointed visitor said.
Were you planning to book a 2 BHK or 1 BHK Flat? I asked him.
1 RK. For investment. Controlling his tears, the angry & disappointed car owner investor said.
Who said you will not get a flat? We have opened booking of the 2nd phase! Don't waste time. Go in. The junior representative of Paranjape Schemes said.
In no time, all ran inside the pandal.
But there was one more crowd in the pandal. Angryly arguing with the representative of Paranjape Schemes.
How can you increase the property rates in one night? An old lady asked.
Why didn't you announce the increased property prices in today's ad? An old man asked.
Pointing at the layout plan the representative of Paranjape Schemes said -
This is a first phase. All 1,000 flats in the 1st phase were booked on Friday & Saturday. Only not to disappoint you, we have opened booking of the 2nd phase.
Otherwise - we were planning to open booking of the 2nd phase in 2016-17.
Because, the construction of the 2nd phase will start - after we complete the 1st phase. Means 2 years from now.
Considering hike in the raw material costs in 2017 - 18 - we have increased the property rates of the 2nd phase.
Plus, the flat sizes in the 2nd phase are bigger.
So, in the 2nd phase a 1 BHK goes for 20 -21 Lakhs & a 2 BHK for 30 - 31 Lakhs. All inclusive prices.
Our representative at the sample flat will explain to you in details. Please, go & have a look.
5 lakhs more? 1 BHK was only for 15.25 Lakhs - now, you are asking 20 - 21? This is unacceptable. An old lady said.
15.25 was the basic price. Including government charges it was - around 17 Lakhs. We have increased rates by only 300 rupees - from 2900 to 3200. So, now, the basic price is 17 and after government taxes - it is 20 - 21. The representative of Paranjape Schemes said.
Means - the property prices in your ads were misleading. I was not expecting this from Paranjape Schemes. An old man said.
And what about 1 RK? A smart young man asked.
No 1 RK in the 2nd phase. The representative of Paranjape Schemes said.
This is wrong. This is injustice against us. Said the beautiful wife of the smart young man and started crying.
Holding her close, the smart young man said - Today, young couples can afford to invest only in 1 RK. That too - because the booking amount is only 5,000 and payment plan is 5 - 90 - 5. How can you offer less number of 1 RKs when you plan affordable housing?
Why only young couples? Even we - middle aged middle income people too - can afford to invest only in affordable 20 - 30 lakhs properties at the far away locations - like this. Don't take it to heart. For middle class salaried people - property investment opportunities are very less. If not this - then invest in the next Paranjape Scheme. A middle aged man told the couple.
And - if the flats are available - from Monday - you can visit the office of Paranjape Schemes and book a flat by paying 5 %! Who knows someone may cancel the booking of 1 RK. The representative of Paranjape Schemes said.
Yes! Never lose hope. Look at us. We booked one 2 BHK yesterday. Today we are back with my sister. She wants to invest in a 1 BHK. Today, she has to pay more than what we have paid. But I have told her - go for it. Book. Down the line everything turns out well. A middle aged man told the couple.
Instead of wasting time here - better go inside & book. The representative of Paranjape Schemes said.
I thanked the middle aged couple for boosting the morale of the young couple and asked - What you said - about you & your sister's investments - is it true or you just made it up to calm him down?
All true! Look around. Most of the people are like us. Middle class investors. What about you? The middle aged man asked.
I am Ravi Karandeekar. I am Pune real estate blogger. I am here to enjoy this 5,000 rupees tamasha. I said.
Tamasha? What do you mean? Isn't it good investment? The middle aged man asked.
This is not an investment. This is addiction. Addiction of debt. When you borrow to invest - you create liability. You create debt. We all have become debt addicts. Debt is our drug. It gives us "kick". Illusion. Hallucination of prosperity. I said.
You are talking nonsense. The middle aged man said.
Yes. You are right. I am talking about nonsense. I said.
Launch of Paranjape Schemes' Happiness Hub at Khed Shivapur - Photo Visit:
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| Launch Ad of Paranjape Schemes Happiness Hub at Khed Shivapur, Pune |
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I cant believe this that 1000 flats were booked in 24 hrs (considering they worked 12 hrs per day). This seems to me like a Gimmick played by a builder just to increase the price. And important point noted by Ravi here is Debit addiction. Indians are the most addicted to this addiction. Soon or later everyone has to pay for this including Banks, Builders and Buyers.
ReplyDelete"Soon or later everyone has to pay for this including Banks, Builders and Buyers" - very true, Sandip. Sad thing is all governments promote debt! Have a look at this article on The Debt Economy -
DeleteJohn Kenneth Galbraith wrote that all financial crises are the result of “debt that, in one fashion or another, has become dangerously out of scale.”
The recent financial crisis was no exception, with everyone—homeowners, private-equity investors, our biggest banks—taking on enormous amounts of debt.
If it’s frustrating that the government is footing the bill to clean up the mess, it’s even worse that the government helped pay for the debt binge that created the mess in the first place, thanks to a tax system that actually subsidizes borrowing.
Debt didn’t get dangerously out of scale because the system was broken. It got out of scale, in part, because the system worked. Read more at - http://goo.gl/RStJKE
"Soon or later everyone has to pay for this including Banks, Builders and Buyers."
DeleteCompletely agree.
Bank NPAs hit 10-year high in Q2 -
The banking sector’s bad loan situation is getting grimmer with non-performing assets ballooning and outpacing credit growth. The gross NPAs of 19 banks in absolute terms touched a high of ₹2.6-lakh crore in the September quarter compared with ₹2.3-lakh crore in the three months ended March 2015. This is the highest in the past 10 years.
http://www.thehindubusinessline.com/money-and-banking/bank-npas-hit-10year-high-in-q2/article7866972.ece
Yezdi Motiwalla
DeleteYezdi Motiwalla All marketing tactics to sell some flats then stop sell the increase the price all are white collar sharks Its time for revolution & stop making slab wise payments it has to be linked with the entire projects which includes AMENITIES TOO In Solidarity Jai Hind
Like · Reply · Just now
Mr. Karandeekar
ReplyDeletePhotographs are very good. I think you changed your camera phone ... !!
Every other is same .. addiction at its best ..
but see the expressions on home buyer faces .. those are really marvelous ... and catches by your new camera .. full of satisfaction .. god bless
Thanks, Milind! Yes, it is Samsung Galaxy EK-GC100.
DeleteAnd when booking amount is only 5,000 - payment plan is 5 - 90 - 5 - and flats prices are between 10 - 30 Lakhs - the so call investors forget two important principles in personal financial planning -
Delete1) Debt To Income Ratio -
A personal finance measure that compares an individual’s debt payment to his or her overall income. A debt-to-income ratio (DTI) is one way lenders (including mortgage lenders) measure an individual’s ability to manage monthly payment and repay debts. DTI is calculated by dividing total recurring monthly debt by gross monthly income, and it is expressed as a percentage. Read more at - http://goo.gl/Ktdftj
2) Liquidity Ratio -
There is another personal finance ratio which can be calculated if we take into account all your assets which could be converted into cash rather quickly, say within 3-4 days. It is called the Liquidity ratio.
The liquidity ratio is helpful in catastrophic circumstances when you need to liquidate much more of your assets than just the liquid assets seen in Basic Solvency ratio.
Liquidity ratio = Liquid Assets / Personal Net worth
Read more at - http://goo.gl/zQhCjn
The NPAs in housing sector have already begun to rise at alarming rate, thanks to over-leverage done by builders, buyers who borrowed more than they could repay. Not just end users, even investors are defaulting as they ate more than they could chew. The latest report from Finance ministry also shows rise in housing sector NPAs.
DeleteHigh-cost housing market in India is on the edge of a bubble and could burst any time, thanks to banking sector's predilection for high credit. Banks are pumping too much credit in high-cost housing, where sales are stable or down, creating an artificial price hike.
Overall credit growth of banking sector is 8.4 %, which is the lowest in last 20 years.
Finance ministry document indicates growing non-performing assets or NPA in housing sector.
http://www.dnaindia.com/mumbai/report-banks-go-for-high-credit-leave-affordable-housing-in-cold-2147898
Nicely written blog....We met & discussed about need of such affordable housing, people are really searching for such kind of shelter, a firm foot somewhere in the metros, especially who have come from outside. Paranjape builders have put a trap of 5000/- & made it.
ReplyDeleteThe buyers who will sustain through all formalities are the successful ones...Others who can not make it, will not only loose 5000 but pass on an advantage to builders, to get new buyers with revised pricing & terms.
We hope others will follow & launch REALLY affordable housing schemes looking at the success of Paranjape schemes.
Foe genuine Buyers, certainly this is a missed opportunity, which brought tears; but for Investors, as you have rightly said, this is Hallucination of prosperity....
Nagesh Kinikar
"Foe genuine Buyers, certainly this is a missed opportunity, which brought tears"
DeleteWhat's in there to cry ? Buying under-construction project, located at nowhere ?
Genuine buyers should be sad had this been indeed value for money project, was ready for possession with all sanctions & had livable infrastructure around.
Tomorrow a builder will launch a project of 200 sq ft salable in Thar desert for 1 Lakh, booking amount Rs.200/-. 10,000 flats sold out (without agreement) in 10 seconds. So what to do ? Cry ? Lol.
All this exercise of builder looks like scam.
ReplyDelete1000 flats sold out in few hours !! This is just to hype up things.
There is difference between booking and agreements. Bookings can be manipulated, not agreements & unless we see 1000 agreements which are registered at registrar office, this is just a number floated by builder without any credibility.
And this location of project is good for motel, wonder what people will do by staying right on highway. Maybe builder will offer free dhaba as additional amenity !
Other example of Paranjape schemes is that of Richmond Park, Rahatani. This was launched over an year back & this too got sold out in few hours.
But even now, the construction has not yet started. If project has already been almost sold out, why Paranjape is not starting construction even after an year ?
Either actual sales are very poor or builder is doing sort of ponzi scheme where this money from buyers is diverted somewhere else. Paranjape should answer why Richmond Park construction work has not yet started even after an year despite sales fellows saying they have all sanctions.
So this khed shivapur project can also be delayed by years, who knows. Paranjape schemes is now increasing loading, delaying possession and also changing plans without permission from buyers mid-way into projects as seen in Blue Ridge, Forest Trails.
With these type of launches & false propaganda of builder, it further substantiates reports that real estate prices are in bubble and NPAs will only increase further as the Finance ministry report mentions.
All this brings us back to the fact that its best to buy ready for possession flats.
Several builders are going to go bankrupt by end of this financial year & big price crash in property market is expected, which is again mentioned in earlier report.
http://accommodationtimes.com/it-is-worth-waiting-to-buy-homes-till-april-2016/
I will continue to rent at just 1.5% of flat price till property prices fall by atleast 50%.
I think after hitting IPO equity market 7-8 yrs back & duping retail & institutional investors by collecting huge premium when the worth was nothing, then taking huge loans from banks sometimes even at very high interest rates & duping them as well, now builders strategy seems to be planning "affordable" projects in far flung places & collecting interest free funds from greedy fool middle class investors by luring them to create a huge debt by using catchy terms like 5-90-5 payment terms etc. What investors fail to understand the risk they are taking by buying such properties where nothing is guaranteed except pre EMIs to banks as soon as bank disburses funds from loan a/c to the builders. Unfortunately 1000s are signing on a dotted line within minutes without thinking twice or checking any documentation or financial position of the builder. In real estate, brand is everything irrespective of whether it is earned in construction industry or not. People blindly trust brands & leave their future in the hands of builders.
ReplyDelete"now builders strategy seems to be planning "affordable" projects in far flung places & collecting interest free funds from greedy fool middle class investors by luring them to create a huge debt by using catchy terms like 5-90-5 payment terms etc."
DeleteCompletely agree. Sort of ponzi scheme.
5-90-5 payment schemes itself shows not everything is good with the builder.
The builder plans to raise money at the cost of flat buyers or rather partners with builder as Ravi rightly says & the greedy investors are ready to jump without seeing anything - left, right or centre. That's why when lot of projects are getting stuck mid-way, I don't feel any sympathy for such investors who jump in with big greed in their minds. Actually, these should not be called as investors but speculators.
"Unfortunately 1000s are signing on a dotted line within minutes without thinking twice or checking any documentation or financial position of the builder."
May or may not be because this number is as per builder, so can be fake. But whoever has booked without checking documentation or financial position of the builder as you rightly mentioned, needs to be given 'Golden Owl Award'. :D
"People blindly trust brands & leave their future in the hands of builders."
And then come here asking for help. And then such builders files FIR against Ravi for highlighting builder's ill-deeds. Greedy investors buy flat, but Ravi ends up having a FIR against him. Lol.
Many times it is not the greedy investor, but a common man who shows trust not only to the brand but more to those public sector banks who provide funding and home-loans, respectively to promoters and buyers of such projects; those are not even having environment clearance. Thanks to this blog, people like you and consumer forum agencies who are spreading awareness.
DeleteAnother point to be noted: in the floor plans of 1BHK, you find the terrace is 20% of the total area. While I like terraces, paying 20% of the project cost on terraces is also disproportionately high. Therefore, indirectly, you are paying higher than the advertised psft rates.
ReplyDelete1000 flat in 1 day. Is it a joke? Some should raise a RTI who bought 1000 flats?
ReplyDeleteI saw many of such schemes builder sale first bad flats and say all other flats are sold out. By bad flat i mean flat at the back side of building or all such locations. All good flats will be in inventory to be sold later for higher price. Very bad tactics of builders. Buyers are now fed up of such techniques
Most Most Important "This Project "Happiness Hub" is yet to receive Environmental Clearance.
ReplyDeleteVery important piece of information. Thanks.
DeleteSometimes I wonder who is more stupid - builders launching project without sanctions or buyers buying in illegal project ?
All those who booked here should be given - Golden Owl Award !