You have probably bought clothes, gadgets and home furnishings online. Why not a brand new home?
Tata Housing has sold over 700 homes online. In the Great Online Shopping Festival (GOSF), which is slated for December 10-12, 2014, many developers, such as Godrej Properties, Mahindra Lifespace, Puravankara and Ashiana, are selling homes over the internet.
Increasingly, developers are opening up avenues for home buyers to purchase online.
But unlike those buys that come with warranties and are delivered immediately or other small ticket purchases, you need to tread with caution before you add a new house to your shopping cart.
The first benefit is that you can block a home by making a nominal payment of say ₹30,000, with your credit card. Secondly, websites such as housing.com provide 3D models of the home along with information regarding availability. So home buyers who cannot visit the property before booking can block specific units online.
Thirdly, similar to online marketplaces, you may be able to land good deals by buying online. For example, Tata Housing offered a guaranteed rent of ₹10,000 to every customer for a period of one year upon possession when it tied up with Snapdeal. In the upcoming GOSF, Puravankara is planning to offer many flats that are either already ready to move in or very close to be given possession. And if the customers do not like what they booked, they can change their selection, pick from a different project or cancel completely penalty-free within six weeks.
For builders, going online offers multiple benefits. It widens their reach to those who are not in the city where the property is located — NRI buyers and those in tier-2/3 cities, for example.
The cost of advertising and selling is also less online compared to traditional methods. Builders say that over half their enquiries are already generated online.
Do your homeworkBut the convenience of buying online must not lull you into thinking that all it takes to buy a home is the click of a mouse. Just because it is sold as easily as clothing does not mean buyers can skip due diligence and research. You must check on the location, project specifications and builder’s credentials. If all these are to your satisfaction, you must also preferably visit the site to understand where it is located and what facilities are nearby. Also, any issues in the vicinity, such as garbage dumps, will only be known by going there.
Unlike most products bought online, there are legal aspects to consider as well when buying a home. You must check the agreement to know the terms such as penalties, cost escalations and other such clauses laid out that may affect your cost. Get the land titles and other property details cleared by a lawyer. Ask for the payment terms so that you can arrange your finances accordingly. If you plan to avail a bank loan, be sure you qualify or know the terms when buying online if you are unable to fund the purchase yourself.
Also, while booking may be a snap, you may be missing out on a lot of deals that can likely happen face-to-face. For example, given the slow down in the sector, there are pockets of unsold inventory. An interested buyer may be able to extract incredible deals from an eager builder.
All said, booking is not the real ‘pain’ faced by home buyers. On the contrary, it may be a small joy that is followed by hassles associated with tedious paperwork and procedures for securing loans, legal documentation, registration as well as missed delivery dates. Buying online does not relieve you of these onerous issues. So if the home you will anyway buy offline is available online with some benefits, check it out. Even in this case, you can use the terms they offer online to negotiate a better deal offline, given the buyer’s market we are currently in.