Over the years, as a result of changing customer habits and tastes and intense competition amongst developers to be ahead of the rest, the list of amenities on offer in residential projects has changed dramatically!
The basic run of the mill common amenities of yesteryear, have been replaced with more modern and technologically superior amenities. In addition the modern looking society now boasts of swimming pools, club houses equipped with gymnasiums, DG backups, solar water heating systems, convenience stores, party zones, hi-end access control systems, Sewage Treatment and Water Treatment Plants, etc.
While some of these are necessary given the changes in lifestyle and security needs, others may be pure indulgence or even merely necessary so as to be able to boast to peers of the existence of certain amenities. Whatever the rationale for the plethora of amenities in a project, it seems that the sheer abundance of amenities does swing the influence the home buyers' decision. Even though, this might often lead to a significant increase in the cost of the home.
While one aspect of these amenities is the need and the capital cost that customers need to bear to have them in their projects, all these amenities cost more to maintain and require a certain level of expertise to run and manage smoothly and efficiently for the owners of the housing society. It was not the case earlier, where housing societies were easily managed by a part time manager, reporting to one or two retired home owners who took personal interest in the affairs of the housing society.
Today's societies, with their plethora of amenities, require expert capabilities, full time staff and cost substantially more to run and maintain. High annual maintenance costs and qualified personnel are required to keep the equipment in proper working condition. Unless this is done, the entire premium paid by the customer for amenities rapidly erodes if not well managed.
Take the example of a development that boasts of 100% DG backup for the residences or offices. Given the load shedding cities are facing today, the cost of diesel for running the DG set is substantial. If separate meters are not provided for monitoring the individual power consumption, non-occupiers are burdened with paying for generating costs for the occupiers in the absence of a proper monitoring mechanism. This potentially leads to disputes, nonpayment and eventually the equipment goes into a state of disrepair and non use.
Before giving in to the lure of glamorous amenities, customers should ask for the running costs, replacement costs and assess occupancy/utilization of various facilities. To quote an example from my own experience: We had built a pool built for one of our premium residential developments in Koregaon Park, only to find it filled up with mud, within a few years! A lawn had been created in its place. There were only 25 families in the condominium; they thought a lawn was more of a utility than a swimming pool.
So do customers buy blindly? Is the glamour becoming a necessity? Or is there merit in not providing the additional bells and whistles? And more importantly, do buyers see that merit?
Do send me your thoughts or experiences on this. Rohit Gera
As with other investments, real estate too carries a certain amount of risk. Readers are advised to undertake their own due diligence and take judgement calls based on their own research and not on the article.