Builders set longer deadlines to protect themselves

"Oh, why are you having tea today V?" she asked, as soon as she entered my room with a view.

"Just like that," I replied. "Some change from the usual."

"Ah, and I thought you would never leave coffee."

"I haven't. Just a small change in the new year."

"Interesting," she said. "I wanted to talk to you about a problem that a friend had recently faced."

"Tell me."

"This friend of mine wanted to buy a flat."

"In Mumbai?"

"Yup."

"Must be a rich dude."

"He is."

"And then what happened?"

"Basically, he went to a neighbourhood broker that somebody recommended. The broker shared details of a project, which he said was about to be completed in a few months."

"Hmmm."

"So, it wasn't an out and out under-construction project because it would be ready soon, but at the same time price wise it was lesser than a fully complete flat would be."

"So, did your friend go ahead and buy the flat?"

"Which is where things got very interesting."

"Like how?" I asked.

"When my friend showed a little more interest and started talking money with the broker, the broker told him that the project should be ready by late 2019."

"Oh. From a few months to late 2019."

"Yes. This is when, someone told my friend to not deal with the broker and approach the company directly," she said.

"And what happened there?"

"Well, the sales manager at the company told him, you know how these brokers are, they will say anything to make the sale."

"Ha ha," I replied. "That was honest from someone who works for a builder."

"Yup."

"So, what did the builder's manager say about completion of the project."

"He said, it should be done and dusted by early 2020, and worse come worse, my friend should be able to move into the new flat by mid 2020."

"Ah. More delay."

"Yes. Basically, something which should have been ready in a few months, was moved to mid 2020, in a matter of a week."

"So, finally did your friend by the flat?"

"Ah. Don't jump the gun V," she said. "I haven't completed the story."

"Oh, there is more to it."

"Yes."

"Tell me. Tell me."

"Someone then told my friend that he should go and check out details of the project on the website of the real estate regulator."

"Yes, that is the first thing he should have done," I said.

"He should have. But he did not know that anything like that existed."

"Okay. And what did he find on the website of the real estate regulator?" I asked.

"He found that the completion date of the project given on the website is June 2021," she replied.

"Which is almost two and a half years from now."

"Yes."

"What is happening here V?"

"I think builders when they share details of any project with the real estate regulator in a state, like to take it a little easy."

"As in?"

"If they give a tight date of completion, and miss the deadline, then they are liable to pay a fine to buyers."

"Oh."

"So, they like to give a date of completion which is well into the future, in order to ensure that even if there are delays they are able to complete the project in the given time, and in the process don't have to pay any fines."

"Interesting."

"So, did your friend finally buy a flat?"

"Oh, he did. But a fully complete flat in a building where people have been staying for a couple of years."

"Hmmm."

"He ended up paying more. But I guess it's worth every penny, given the risk any under-construction property carries. Imagine, he didn't even get a fixed date on when the flat would be completed." she said.

"Yes, in India, anything goes," I replied.

(The example is hypothetical)

Vivek Kaul is the author of the Easy Money trilogy.