Freebies like costly cars, air conditioners get the thumbs down, caution is the word in the city

Freebies, even if they are a Rs27 lakh BMW, offered by some real estate developers, have not seen prospective buyers rushing to buy homes in the city.

Even though many builders with projects all over the city have dangled carrots like new vehicles, air-conditioned rooms, 40-inch LCD televisions, Sony home theatre sets, and DVD players for every apartment booked, there have been only a few takers.

A recent survey by Delhi-based Makaan.com — a real estate portal run by the People Group — has revealed that 66% of Pune buyers have turned down the freebies.

Real estate prices may be crashing in the city, but many builders are increasing 'loading', or difference between carpet area and built-up area, negating discounts on offer.

Developers charge buyers for every inch used up by amenities like lobbies, staircases, flower beds, storage rooms, lifts, and even walls separating flats. The loading varies from 20% to 35%.

"But hit by the real estate gloom, a cross-section of developers has increased loading up to 50%," said the head of a global real estate firm. "Most builders quote rates on the saleable (built-up) area, which can often be misleading, particularly if loading is high."

Slowdown has hit the realty sector rather hard. Infrastructure projects too have slowed down somewhat. But Ajit Gulabchand, chairman and managing director of Hindustan Construction Co Ltd (HCC), is not worried. The company is going full throttle on its ambitious Lavasa lake city project and has also bid for the Worli-Haji Ali sealink project. In a chat with DNA Money's Ashish K Tiwari and G Seetharaman, Gulabchand elaborates on the reasons behind these moves. Excerpts…

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In a major relief to prospective flat purchasers and the beleaguered property developers, the state government on Friday stayed its earlier decision to levy a flat rate of 1% registration fee on transaction of any property, irrespective of their market value.

The government took the decision in a cabinet meeting held late on Friday.

What this means is that the earlier rule of whereby the buyer had to pay 1% on the property value, upto a maximum of Rs30,000.

Under the new rules it had framed, it had done away with the Rs30,000 cap and had ruled that a purchaser of any property would have to pay 1% on the value.

Washington  - US mortgage giant Fannie Mae reported a 25.2- billion-dollar quarterly loss on Thursday and asked the government for cash to keep it afloat.

Fannie Mae asked for a 15.2-billion-dollar capital infusion from the US Treasury and said it could need more if the housing and credit markets continue to worsen.

It was the sixth-straight quarterly loss for the lender that was taken over by the government last year. Losses for the year came to 58.7 billion dollars.

Parsvnath Developers Ltd, the New Delhi-based developer, has postponed its luxury mall-cum-office complex in Connaught Place, the commercial hub of Delhi.