Who wouldn't want to save a few lacs on pre launch offers? But the question is, is it really worth it? Let us understand how it may not be a right thing to do. In this video we have tried to cover the topic on the consequence of pre launch rates as per the construction raw material rate hike.
It is seen that today the cost of construction has gone up by almost 30 - 50 % which has impacted the profit margin of the builders. So what exactly happens on pre launch ? A tentative price bracket is freezed whereby bookings are picked up.
What happens next? Now the builder is in a catch 22 situation whereby the rising material cost as well as the hike in diesel price will impact the profit margin of the builder and due to the pre launch offer the builder cannot change the rates. In order to make profit the builder may compromise on the quality of the material used, and will sell at a higher price to new customers, and in some cases the builder may delay possession as well. In some cases if there is a financial crisis the builder may stall the project itself.
In some cases the builder owning land parcels in the outskirts may sell it at a higher price in order to keep the cash flow in place, this is also a sign that the builder is not a cash rich company and the chances of project going delayed is high. So what must one do? Before you decide to grab the pre-launch offer, ensure that a detailed study about the builder is done before, the pros and cons about the location, the future ROI of the project, and the analysis of the project itself. Only when you feel that the project is fulfilling the majority of your requirements that you may go ahead with the pre launch offer.