SMART SOCHO: Why buying property online is a win-win for both buyers and sellers

The growing popularity of buying property online is backed by the buyer's demand for a transparent, hassle-free experience and the builder's need to drive sales and track customer preferences writes Rajesh Kulkarni.

The stressed real estate sector has found a potential savior in the country's fast developing e-commerce marketplace. Taking the lead was Tata Value Homes which became the first developer to join hands with an e-commerce portal (Snapdeal) earlier this year. On offer were affordable homes priced in the INR 30-70 lakhs category.

With buyers responding in large numbers it wasn't long before other developers - Godrej Properties, Purvankara, DLF and Mantri among others - jumped on to the e-commerce bandwagon. Others like Wave Infratech and Raheja Developers announced tie-ups with Snapdeal and bookmyhouse.com respectively, with Raheja claiming online bookings for approx 500 apartments in just months.

Clearly getting onto the online platform is proving to be a profitable alternative for the real estate industry which until recently was plagued by rising unsold inventory numbers and falling sales.

However from a customer perspective, industry experts caution that it's a must to verify the credentials of the builder prior to signing up for an online property purchase.

"Verifying a builder's track record and reputation in the market is vital regardless of whether it's an online or offline realty transaction," concurs Adarsh Awasthi, a realty analyst. "Buyers need to pay attention close attention to important details like the builder's reputation, project location, size etc rather than just being swayed by the attractive discounts."

However the promise of a hefty discount minus the usual hassles associated with offline property buying in India is a strong lure for property buyers opting for the online platform. "Traditionally Indians have always been price-sensitive buyers and property is no exception," opines a leading Mumbai-based developer (name withheld).

"Most of the popular e-commerce sites have a reputation of offering good products at a hefty discount - a concept that has proved to be very popular with the domestic consumer. The same idea is now being applied to realty projects packaged with attractive discounts and freebies, its selling just as well."

It's a concept that has worked very well indeed for home buyers like Sneha Joshi, a finance professional and a regular on e-commerce portals. "I was on the lookout for a bigger home and happened to log on to an online property sale. The apartment I liked was perfect, the discounted price was well within my budget and the developer was a trusted name, so I went ahead and made the booking."

Joshi was one of about 200 buyers who made a booking with the developer for the same project during the online sale which lasted for about three days. The deciding factors? The strategic location of the project, attractive price (tempered by an adequate discount) and the assurance that the under-construction project would be delivered on time (end 2017), based almost entirely on the builder's reputation and track record of completed projects.

It a trend that's here to stay with more and more buyers now opting for an online purchase as opposed to the conventional broker approach. Features like a virtual tour of the selected property, pre and post-sales service, assistance with the paperwork, no brokerage (in a majority of cases) and just the simplicity of making a fully-secure asset purchase from within the comforts of their home/office are proving to be an irresistible draw for a majority of online realty shoppers.

Quite understandably developers are making the most of this new phenomenon and throwing in a few ‘extras' to boost sales further. According to an official of a leading Mumbai-based developer while on normal days their online efforts account for between 2-5 units sold each day, there is a huge surge in demand when the company announces a special exclusive online offer, like the promise of a further cash discount or an extra room for bookings made on a particular day.

However while most reputed developers have made a windfall on various online platforms, it's by no means indicative of similar success for all the players. "When it comes to selling property online the most important factors to consider are the credibility and reputation of the developer," elucidates Awasthi.

"In an industry that is hugely fragmented only a few players can stake their claim to this, while smaller players will find it very difficult to survive in an online environment", he adds.

Inordinate delays in the completion of new projects, continues to be the bane of the realty industry and most buyers are wary about where they invest because of this very reason.

According to Liases Foras, of the approx 1.8 bn square feet of residential supply in the country, a massive 40 percent projects were delayed beyond a year, with big cities like Mumbai and areas around New Delhi accounting for most of them.

Understandably then buyers are watchful even when it comes to making an online property purchase from reputed developers. According to data compiled by a leading realty advisory, online buyers are known to make a minimum of 4-5 visits to the site and property and take anywhere between 30-40 days before making the purchase.

From the builder's perspective, regardless of when the customer makes the purchase. His interest in the project gives them a valuable leads on potential customers, customer preferences and a reliable lead generation tool.

As a leading builder puts it, "Having a presence on a e-commerce platform is not necessarily to drive numbers but also helps immensely in brand visibility and connecting with potential customers and learning about their preferences."

Clearly the advent of the online platform has given a new avenue for both developers trying to drive sales numbers and buyers looking for a good deal to come together on a common platform.

Industry experts further opine that if minor irritants like the 2 percent surcharge on credit card transactions and the absence of a realty regulator are dealt with promptly, happy days may well be back again for the Indian realty sector.