Hello All,
I have received a few emails from people complaining about the new pricing strategy adopted by Sobha Developers. In the press there is a lot of news about price reduction and it seems that Sobha Marketing team is also talking a lot about it. Effectively they seem to have reduced the price for their property on a per sq ft basis, but if you happen to get a chance to look into the details, you would know what it really is. They have considerably increased the prices elsewhere, like:
Share of Land - Cost of that seems to have been increased by nearly 100% or more
Car parking - Increase of nearly 50%
Club House - Increase of nearly 50%. In some cases even 100%.
Other charges like Electricity and Water Supply have also increased by 25%.
I am not sure if the above price increase is in tandem with the actual cost increase. However i would suggest new buyers to check all these well in advance. They seem to have reduced prices in some place and increased prices in some other places, so net affect balances out.
So bottom line is - dont get carried away by this "so called" price reduction. It might be not be true as you might be thinking. Get down and see the details carefully and make your judgement.
Showing posts with label Note This. Show all posts
Showing posts with label Note This. Show all posts
Sunday, March 22, 2009
Sunday, April 6, 2008
Book flats from Sobha Developers at your own risk
There are many reasons, why you should be careful before booking flats with Sobha Developers. I will list down the main areas of concern below:
1) Delivery Delays (my project delayed by 1.5 Yrs and still not sure of exact handover date...this could be longer)
2) Be ready to lose 25% of project cost...by the time they deliver, your net project cost would have gone up by 20-25% (my experience)
3) Careful with their agreement clauses.
4) Careful with their payment schedule...this has no relevance to their construction progress.
5) Careful with their sales promises...knowingly or unknowingly they may be cheating you (my personal experience) and management does not care about those promises.
Delivery Always late:
I have booked a flat in Sobha Iris in January 2006. The flat was supposed to be ready by February 2007. The delivery was postponed 3 times till now. Sobha gives a date and when the date nears they postpone it by 6 months. The current promised completion date is end-July’08 (mind you...it’s completion date but not handover date!). Even if they handover in Aug’08 it’s a good 1.5 Yrs delay.
Financial Loss:
If you book a Sobha flat, be ready for a loss of about Rs.10 lac. I have calculated my financial loss to be about Rs.11 Lac (assuming delivery will be in Aug’08. If it delays further, then be prepared for more losses).
Do they cheat ?:
Am not sure whether it is intentional. We were given a payment schedule and were told by their sales that the construction will be completed as per that schedule. However, 96% of the payments have been collected by Aug-2007 (means 96% of the construction should have been completed) and the rest 4% takes more than an year !! It means, Sobha completed that part of the project which gets them money on time and conveniently delays the rest for any period as they have already got their money (including profits!!). Very efficient cash flow planning with customers money indeed !! Mind you, they are right to have collected the money, if you look at the agreement wording. I only hope that this is not a new form of organizational cheating.
Agreement Terms:
They are mostly one-sided. They also charge hefty Advocate fee from customers. This basically means you are paying the advocate fee to have the agreements designed for the benefit of the "Other Party". Considering that all the agreements use the same format - Advocate fee is really wonderful profit margin !
Be cautious of delay clauses : What happens if the project is delayed ? Developers may also have a clause to pay penalty on delay. But look at these clauses carefully to see when they are not applicable and argue with them to change suitably.
Be cautious of Payment Schedule:
Ask them questions on, what it means in terms of actual completion. Most probably, you will pay all the money at least 1 yr in advance, though they claim otherwise !!!
Ask them questions on sharing of financial loss. e.g. if they delay the project by 1-2 years, govt may increase taxes & levies. If the increase is substantial, then you will lose a lot.
1) Delivery Delays (my project delayed by 1.5 Yrs and still not sure of exact handover date...this could be longer)
2) Be ready to lose 25% of project cost...by the time they deliver, your net project cost would have gone up by 20-25% (my experience)
3) Careful with their agreement clauses.
4) Careful with their payment schedule...this has no relevance to their construction progress.
5) Careful with their sales promises...knowingly or unknowingly they may be cheating you (my personal experience) and management does not care about those promises.
Delivery Always late:
I have booked a flat in Sobha Iris in January 2006. The flat was supposed to be ready by February 2007. The delivery was postponed 3 times till now. Sobha gives a date and when the date nears they postpone it by 6 months. The current promised completion date is end-July’08 (mind you...it’s completion date but not handover date!). Even if they handover in Aug’08 it’s a good 1.5 Yrs delay.
Financial Loss:
If you book a Sobha flat, be ready for a loss of about Rs.10 lac. I have calculated my financial loss to be about Rs.11 Lac (assuming delivery will be in Aug’08. If it delays further, then be prepared for more losses).
Do they cheat ?:
Am not sure whether it is intentional. We were given a payment schedule and were told by their sales that the construction will be completed as per that schedule. However, 96% of the payments have been collected by Aug-2007 (means 96% of the construction should have been completed) and the rest 4% takes more than an year !! It means, Sobha completed that part of the project which gets them money on time and conveniently delays the rest for any period as they have already got their money (including profits!!). Very efficient cash flow planning with customers money indeed !! Mind you, they are right to have collected the money, if you look at the agreement wording. I only hope that this is not a new form of organizational cheating.
Agreement Terms:
They are mostly one-sided. They also charge hefty Advocate fee from customers. This basically means you are paying the advocate fee to have the agreements designed for the benefit of the "Other Party". Considering that all the agreements use the same format - Advocate fee is really wonderful profit margin !
Be cautious of delay clauses : What happens if the project is delayed ? Developers may also have a clause to pay penalty on delay. But look at these clauses carefully to see when they are not applicable and argue with them to change suitably.
Be cautious of Payment Schedule:
Ask them questions on, what it means in terms of actual completion. Most probably, you will pay all the money at least 1 yr in advance, though they claim otherwise !!!
Ask them questions on sharing of financial loss. e.g. if they delay the project by 1-2 years, govt may increase taxes & levies. If the increase is substantial, then you will lose a lot.
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