By Mr Deepak Kaistha
Having a big lavish property always features in an individual’s bucket list. However, given the sky-reaching prices of real estate today, it looks like a distant dream. Experts of the field have time and again cautioned how in the recent times, real estate purchases and sales have dipped. Creating a synergy point between the buyers and sellers, group home buying is a unique catalyst for both buyers and sellers.
Often perceived as a new trend in real estate market, group home buying goes back 50 years. To be precise, group home buying has been plugged as a practical solution for property buyers looking to get attractive discounts. In earlier days, when a stakeholder wanted to buy a flat, a builder would give him a final offer. But with the advent of the group home buying concept, like-minded buyers can now join hands and close the property transactions at attractive prices.
Here is how it works. Sensing a dip in the contemporary scenario of real estate market, potential home buyers get in touch with one another via a general platform, typically offered by a third party or a group buying company, and form a network/group. The third party then approaches the builder with a handsome amount of orders and bargains for discounts. The builder looks at it as a lucrative opportunity to sell a bunch of his properties and agrees to the discount.
Particularly advantageous for builders, property builders get a custom-made market to sell their properties in volume without spending anything in customer attainment and branding. The down payments made in group buying are set on an upper limit, giving them the much-needed cash flow.
For instance, if an X developer is selling a 5 BHK apartment at 14,000 per sq ft. The third party, on behalf of the group buyers, negotiates on the price by bringing it down to 7,000 to 13,000 per sq ft. This concession will be much higher than what is offered in individual property buying cases.
In a classic case scenario, the third party who talks on behalf of the home buyers will in all probability be able to attain a 4% to 10% discount on the value of the property. Meaning, if the cost of your dream home is 80 lacs, you can save up to 6-8 lacs in discount! Adding to the discounted prices, people who buy the property will also be able to share other similar benefits, such as a home loan, lawyers’ fee, and compliances.
In view of the wide gap in real estate market today, the call of the hour is connecting the builders with their consumers. And this concept seems like a perfect solution to it. The unique model positioning of group home buying will give buyers a leverage of sitting at the comfort of their homes, logging on our e-commerce platform and making bulk purchases at a pocket-friendly price.
As per my estimate, the real estate market will still take 3-4 years to intensify. Till date, we have 110 million sq ft of unsold inventory, which is an all-time high figure. And by the time this inventory gets absorbed, I am certain that the prices will go up, up-swinging the numbers in real estate market.
Approximately calculating, Group Home Buying as a concept will take about 2-3 years to cement its position in the real estate market.
In the present times, where interest rates are high and stock market tends to change numbers at the drop of a hat, it is a win-win concept for both builders and consumers.
Here, I would like to take this opportunity to announce Volume II of Star Realty – a collector’s book edition (an initiative by Planman Media). A real estate bible, which talks about an in-depth analysis of today’s real estate market, Star Realty II is all set to be revealed in Las Vegas, 2013. It is a book that depicts the insightful challenges and simplifies the complexities of real estate for people at large.
About Deepak Kaistha:
Deepak Kaistha is the Chief Executive Officer of Planman Media and Managing Partner of Planman Consulting. In just over a decade’s association with Planman, he has been successful in catapulting to a position of prominence in the triumph of the group. He has re-engineered Planman’s transition and organisational consulting businesses by dramatically raising its presence in the corporate world. He has maintained his salience and has expanded his line of business in sales, marketing, finance, human resource, and client relations; and has built a strong base and principled approach that remains undeterred.
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