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Old 19th February 2020, 14:48   #31
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Originally Posted by 2000rpm View Post
I keep it simple. I target buying "ready to use" properties, though you have to pay a premium for the same. This leaves little scope for surprise, actually none if the documents are properly vetted.
This works if it is not a 'hot' property, the ones with good plan and in a decent area will be lapped up and only bummers will be available at the last, unless the builder has blocked a few apartments under builder quota, which he normally quotes a premium.
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Old 19th February 2020, 14:48   #32
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

A professional's angle, you might want to call it a tip:

Two, or rather three avenues, apart from the criminal remedies, might be tried. I list them in order of success, or effectiveness, most successful listed first:

1. Insolvency and Bankruptcy Code,
2. Consumer Fora

IBC had been the most rewarding for the aggrieved homebuyers, until the latest amendment made it more of a class action thing. Now also, it is the fastest and the most effective means to recovering the money. Though finding a good one hundred home buyers to institute a case is more of a near impossible thing. If done properly, the money is returned by the defaulting builders within days.

Consumer fora have been good, though it is a fairly time consuming process. We are talking of a period of 2-4 years here.

RERA is more of a toothless tiger, with builders taking no cognizance of the orders passed, and the hapless home buyers running from Bench to Appellate authority back and forth.

Crux of the matter:

First, not to get into the trap of this bubble. However, it has already been burst, so no worries here.

If, unfortunately, you are trapped, try to get more people on board, engage a good lawyer specializing in IBC and NCLT matters and bring the builder to book.

The other two legal recourses can be used in the parallel.

Last edited by deepfusion : 19th February 2020 at 14:49.
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Old 19th February 2020, 14:59   #33
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Originally Posted by Malyaj View Post
My wife and I purchased an apartment from Nitesh Estates in Bangalore in 2013, with the promised possession date being 2014. All the slabs were completed that time and this was a major reason for opting for that particular project. Before finalizing this we had visited about 2 dozen projects. In the last 7 years I have seen each of those projects completed before my eyes, in fact I see some of them while driving to work every day and regret my decision.

I do not want to get into the rant mode as I have done this many times in the last 7 years, individually, with my wife and with other buyers from the same project. I will just share my learnings:


That's a lot of free advice I have dispensed. I paid for this
I am sorry to hear about your ordeal and hope it ends soon positively. What you shared is just valuable to me. I was considering investing in a new property and this thread opened up a lot of hidden information. Thank you for taking the time to share this!

Originally Posted by BoneCollector View Post
Another important thing is to preferably stay away from CGHS (Cooperative Group Housing Societies), especially in Gurgaon. A friend of mine who has been staying in one such apartment in Gurgaon has had a horrible time. About 2 years after everyone in that apartment had taken possession, the farmers who had sold that land filed a court case that their reimbursement has not been as per government norms. And the High Court ruled in their favour after which they had to collectively pay about Rs. 80 lakhs. This was first incident. After this, they've paid 2 times more.
That's terrible to say the least. In Bangalore, land purchase is almost equally risky. People without clear titles selling property and then staking claim later. Even with clear titles, my cousin recently ended up with a dispute which was managed and resolved with some smart decisions and quick moves.

Originally Posted by lamborghini View Post
From the other side here - a builder's (or Developer's as we prefer to call ourselves) representative!
Thank you for this insight. I always wondered how things work from the builder's perspectives.
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Old 19th February 2020, 15:04   #34
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Whenever I will buy a property, I'll prefer a resale, with solid papers, a house I can see & owners I can interact with.
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Old 19th February 2020, 17:04   #35
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Originally Posted by asingh1977 View Post
Purchased an RTM (Ready to Move) back in 2016. Had to pay a hefty premium—but worth the peace of mind. GGN (Gurgaon) is a horror story of purposely failed deliveries. Unitech being the champion.
We bought in Emaar Palm Gardens and recently got possession after more than a decade. So we're lucky we got the apartment first of all. I kept telling my dad it's not a good decision to buy under-construction but he wouldn't listen. Now for some reason, they can't stay there and have to rent it out. If I kept the same money in FD, I would've made more money with zero headache

But atleast we got the apartment while others haven't so that's really sad.

Those builders/promoters should be in jail. Period. It's fraud and the only solution is jail.

Another thing - Why the heck is this still happening i.e. people buying under-construction houses. All the RISK falls on the buyer and nothing on the builder. Ideally, the builder should take the RISK and invest his money and then try to sell the apartments for a profit AFTER construction is completed. In India, Builders use our money and are able to screw us and still no jail time.

Last edited by panamera13 : 19th February 2020 at 17:17.
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Old 19th February 2020, 17:14   #36
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Here is our story:

There was a holiday home project which was advertised massively by the builders using prime time tv shows on Zee Marathi back in 2015. The location was in Alibaug. My dad was interested in getting a holiday home after retirement and this project was within his budget, so we paid a visit to the location and construction was in full swing, sample flat was ready ! We really liked the project and instantly decided that we wanted one flat here. There were other buyers who were paying checks of partial amounts (up to 11 Lakh for those whose slabs have been constructed). Dad paid the booking amount of 51,000 INR using online banking and we got the receipt too. Since ours was not yet constructed, we were not obliged to pay up any amount other than booking, they would intimate us when to pay the amount after plinth and slab were constructed. Everything looked fine initially. The Sales executive was helpful in getting everything done on phone as we stayed in Pune. This was in March 2015 and since it rains a lot in Alibaug we expected the construction activity to slow down in the next few months.

After 3 months, dad got a call that he will have to pay the next installment as plinth construction was about to start. He called the Sales rep at the site but his phone was not reachable. Dad called their head office in Thane asked them if they could send a stamped demand letter for the same. He did not receive it for two weeks but the lady insisted to pay the amount at earliest. We started feeling something fishy and decided to pay a visit to the site again and deal directly with the people there. When we reached there, the gates were closed, there was no guard and not a soul present. Plants had grown on the constructed slabs. It looked like ghost town, perfect location for a bollywood horror movie. The Sales guy who was not picking up the phone earlier finally picked up and reached the place after dad asked him to come there. Apparently, he was a local guy who stayed close to the location. He told us construction was halted due to some incident involving worker's death and would resume soon. Dad did not buy his argument, heck I could see on his face that he was blatantly lying and was doing a very bad job at keeping a confident face. Upon prying a little hard, he told us that court had order a stay on construction and that the case would be over soon. Then he told that he had resigned !

Next week, we headed to their head office in Thane to recover our booking amount as we were in no mood to stay on. When we reached there, we met two people, they were retired men just like my dad and had paid almost 20 lakh rupees for this project and wanted refund ! They told us that they used to sit in the office every weekend as they had nothing else to do after retirement We got our money after following it up for two months with constant calls and my aunt visiting their office frequently. We were lucky enough to get the money early but I feel bad for those who had paid in lakhs. The project is still in limbo after 5 years.

Lessons learnt:
1. Due diligence is important, the court case was about construction on agricultural land. Many farmers around Alibag had sold their land and buyers had started construction. If we had known this earlier, we would have avoided it straight away. Get information from locals if possible. They always know the inside story.

2. Never fall for marketing campaigns: They can bring in some hollywood celebrity to advertise their property, but one should never fall for this trap !

3. Never pay any amounts until you see the construction status by yourself. And paper-work is absolutely important in case things start going south.

4. Be nice to lower level people: The sales representative that we talked to developed a good rapport with us and we never held him responsible for all the mess we were in. A good dialogue with him and he told us everything that we needed to know and that he was serving his notice period !

5. Although it doesnt work sometimes, but going for projects with reputed builders and at locations which have 'some' level of development around it are safer bets.
Never fall for projects which are far off city limits and promise a great lifestyle while defying all logic as to why people would actually go and stay there if no schools, hospitals, industries, public transport or offices are around (DS Kulkarni's much hyped Dream City near Saswad, Pune is a perfect example)

Last edited by NiInJa : 19th February 2020 at 17:23. Reason: addition
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Old 19th February 2020, 17:16   #37
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

India is ranked 63rd in ease of doing business.

But it is ranked 163rd (out of 190 countries) in Contract enforceability. This means that India's judicial system is far worse than several other poorer countries that are generally perceived to be underdeveloped.

Caveat Emptor (Solely buyer's responsibility) is the only way you can ensure you're not cheated. I personally do not have experience in buying an apartment from a builder but I have enough experience in dealing with purchasing sites from developers and dealing with lands.

Most of you know that many apartment projects are in the Joint development format. But many reputed builders outsource everything including construction. They basically get a third party construction company to build in a third party land financed by another third party. The reputed builders plan the layout (also outsourced most of the time), slap their brand name onto the project and do the marketing and sales of the individual units as that is their brand's forte. How much control do you think the reputed company themselves have in such a scenario?

As many have pointed out, it is always best to go for ready to move in apartments even if you have to compromise on certain other amenities. If you have a particular under construction project whose location, amenities or any other aspect you really like, you can always resell the ready to move in apartment you bought and buy a unit in that dream project once it is ready to move in. You'll be shielded against the property price appreciation as your first apartment's price appreciation will make up for it. You'll lose on registration charges and brokerage but that is a calculated risk unlike the risk of getting stuck halfway with dubious projects.

It is sometimes impossible to fight a legal battle against these reputed builders. They know every loophole in the book. I know cases where reputed builders have cheated the landlord using loopholes in the joint development agreement. Even if you can win a legal battle against them, sometimes it isn't worth it.
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Old 19th February 2020, 19:01   #38
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Leaving aside the rampant siphoning that goes on, the main issue is the way builders finance themselves. A lot of it is a semi-ponzi game, take money to complete the other project. Builders should have ensured they were covered for interest and other things.

A diamond merchant friend of mine went bust due to land deals without any malicious dealings. Why?

It stated from 2015
  • The government stated scrutinising real estate and jewellers closely. He got a double whammy from this and had tax liabilities
  • Increased environmental scrutiny
  • RERA
  • Demonetisation
  • GST Implementation

All this hit him but again if he had not over-extended and kept his books in order, it might have been different. He has taken a hit and is focussing on Jewellery. He is determined to pay his investors back.

My in-laws gave there property for development back in 2015. It is three years overdue and my father-in-law is quite depressed. However, the reasons have been
  • Demonetisation
  • RERA
  • Environmental Clearance
  • Two elections at the wrong time when permissions had to be sought
  • The floods in Cochin

In this case, it is pure bad luck but the builder is covered financially

Luckily, the builder is doing his best to honour his commitments
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Old 19th February 2020, 19:16   #39
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Originally Posted by Nav-i-gator View Post
Whoever feels he/she has not been cheated by a builder, please share your story. I don't think anyone would be in that category of God child.
Well, I happen to be one among them.

Sometime in 2002, one evening, over a few drinks, my cousin brother proposes that we should buy an apartment. However, the EMIs will eat up around 60% of our salary and we did not have a penny to give as down payment. So we considered buying one together.

Went to a small builder in town - this is in New Panvel, Navi Mumbai - and presented our idea. He said, even if you guys were direct brothers, he wouldn't recommend buying a flat together. The fact that we do not have any money for down payment (the bank would give only 80% of the total cost as loan) can be solved, he said. He showed a higher price for the flat, charged us the sales tax for the additional amount and covered the registration fees as well in that amount. We decided to buy a flat each for both of us. In effect, within 3 days we were proud owners of a one bed room flat!

Even after all the flats were sold, this builder was really helpful in getting the electricity connection transferred, society hand over etc.
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Old 19th February 2020, 19:18   #40
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Guys, just a thought.

What if insurance companies came up with a policy to insure under construction apartments. The insurance company has all the resources to vet the complex, if they do it right they get handsome premiums.

Buyers will rest assured their life savings are not going for a toss and will be safeguarded. Paying a small premium will be much better than paying EMI and rent together.

Builders can advertise their projects as such if insurance companies insure the homebuyers. Quick selling. Continous Cashflow.

Consider it like a rating agency that actually has skin in the game and are rewarded accordingly.

Where there is risk, there is a market for insurance.

Win-Win-Win ?

Last edited by nasa_hubble : 19th February 2020 at 19:19.
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Old 19th February 2020, 21:11   #41
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

A very interesting topic we booked an apartment in early 2005 and got possession in 2009. The society was ready only by 2011, after relentless follow up by resident groups This is in Bangalore with a Tier 2 builder.

We were looking for another property, preferably an independent villa - how are these in terms of risk for under construction? One of the logic was as land is in your name worst case you can construct the house yourself - not sure how this argument holds though. The builder is Nambiar builders in Bangalore, they only do one project at a time but am still skeptical, especially at the sky-high prices these days.
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Old 19th February 2020, 23:09   #42
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Originally Posted by Vid6639 View Post
Which project was this? I bought a Nitesh Property with same outcome. CapeCod in Bellandur in 2013. Now we just have the slabs completed and almost full payment done but since he is absconding and all his assets seized, it is stuck.
I almost purchased in Capecod in 2013, the picture they tempted was extremely tempting and the location was excellent. Fortunately for me, the prices quoted was out of my budget. Pass that way regularly and feel sad for the bunch of owners who purchased there. Sorry to hear that you had also done a purchase there. Is there any chance of progress on it?

Unfortunately there is no guarantee on how a project turns out. Lot of variables in play and if one manages to get a completed, as per committed specifications flat/house delivered within a reasonable time frame, we can consider ourselves lucky.
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Old 20th February 2020, 01:41   #43
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Many wise comments & experiences shared here. Simple take away is - NEVER invest in an on going project. Its time we stop investing & supporting these builders/goons. If they dont have the capital to build a project without the public's money, let them go away!
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Old 20th February 2020, 07:56   #44
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Default Re: Did you ever get cheated by a builder while buying a house? Share tips & advice here

Builder mafia is responsible for most ills in modern society. Be it our environment degradation or muscle power/undue influence. 'Let them go away' seems like the right slogan
Originally Posted by RMN View Post
Many wise comments & experiences shared here. Simple take away is - NEVER invest in an on going project. Its time we stop investing & supporting these builders/goons. If they dont have the capital to build a project without the public's money, let them go away!
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Old 20th February 2020, 08:33   #45
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Originally Posted by lamborghini View Post
Godrej, Piramal, Tata, Raymonds, etc. are all entering real estate. These are guys who will play by the book because they simply cannot afford to dilute their brand value - clean transactions, and the ability to deliver! Others are going to have to follow suit!
Or so you'd think. Have enough reliable information on how similar Godrej is to other builders. On a project constructed with Shapoorji & Pallonji, Godrej has turned a blind eye to serious lapses of quality and commitment.

From completely ignoring residents' requests and pleas to intervention, legal notices to hiring bouncers to shoo residents from their corporate offices, Godrej has been no saint.

I think brand value, reputation, perception is worth dog shit these days. Else, you wouldn't have the kind of fraud that we've discovered: be it DSK, Mallya, DLF, Jaypee.. the list is endless. Make money while the going is good and run away when it's not. The toothless tiger that Indian judiciary, it'll be ages before some concrete justice is done.
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