Prelaunch allotments – Lessons to learn
 

Some of the projects that were prelaunched last year have reached the allotment stage. Prlaunch was a new concept at that time and the allotment process was not clear then. But since now some allotments have happened or are about to happen one can learn a few things before entering into a launch or a soft launch again.

1. In some cases the allotments have happened by way of draw of lots e.g. Omaxe City Palwal, Omaxe Hills Faridabad etc . So those who are particular about locations, lower floors, vastu directions etc. should know that in advance.

2. In many cases like Omaxe, BPTP, RPS etc second installment was demanded even before allotment took place. Bank loans do not happen without allotment so those investing in launch before allotment should be prepared for 30-35 % pmt in case of flats and 50-55% in case of plots.

3. Additonal charges or as some people call hidden charges like External Development Charges (EDC), Infrastructure Development Charges (IDC), Car Parkings, Power backup charges, Maintenance Security (IFMS/IBMS), Club Membership, Preferential Location Charges (PLC), External Electrification Charges (EEC) and Fire Fighting Charges (FFC) are determined or rather announced at the time of allotment or launch. These charges over and above the Basic sales price are an astronomical sum and can even be as high as 25-30% of the BSP. So one should be prepared for that kind of cost.

4. In some cases like BPTP Parkland, RPS Savana size of the unit at the time of allotment is 10-20% more than as proposed at the time of booking. So this increase in size can increase the cost of the unit.

5. Even the specifications can be compulsorily enhanced and one may be asked to pay that e.g. wardrobes, modular kitchens, type of floorings etc. Like BPTP Parkland is proposing a compulsory escalation of 300 psf for richer specifications. So again once should be prepared for this escalation.

6. One needs to be prepared for govt stamp duty etc at the time of possession for sale deed, registry etc which varies from 6-8% official charges. And 1-2% administrative charges.

7. It is commonly observed that premiums fall when next pmt is demanded without allotment because of absence of bank loans. So those not interested in paying second installment should exit well in advance without waiting for demand letter from company and then panic selling at low premiums.

8. Important for NRIs or living out of station that a General Power of Attorney (GPA) be executed well in advance in favour of family member or friend etc. who would be present at the time of allotment. Some companies like BPTP have made it mandatory.

9. Some companies follow priority number system like Omaxe, BPTP, RPS where the allotment is done in the order which second pmt is received. So those particular about locations should deposit the pmt immediately once is demanded rather than buying time. Funds should always be kept ready in bank when allotment is expected. If they have to be transferred from somewhere else like some other account or abroad account get it done well in advance else you lose priority numbers.

10. Some companies like Omaxe allows inter-change of locations between two allotments if the two are willing to inter-change. Try buying through a dealer or an associate who has sizeable chunk of bookings. The more bookings one would have the more would be probability to locate somebody who would be willing to interchange.