Puravankara has just launched its IPO, DFL has done so. The real estate sector is on fire, prices are skyrocketing. Just like in India, there is a housing boom in the USA. Currently, the market is experiencing a slow down.
Angry homeowners in the US who bought homes, and found them to be structurally problematic have taken to the internet.
This is the expected fall out of a boom in the housing market, more so if customers are not patient and demand quick delivery of homes. In the construction business, the level of technology determines the shortest time span required to build a house/flat. In a market where the buyers are impatient, there will be some sellers who will be willing to deliver houses quicker than the minimum time as determined by the level of technology, therefore they will have to cut costs.
Secondly, if there is a boom in the housing market, the cost of raw materials will increase. If the seller does not have adequate clauses to pass this onto the buyer, then the seller will cut corners to reduce his losses from increasing prices.
I reckon that either of these two factors led to faulty constructions in the USA. If this is the case in the US, where builders give some form of guarantee for the houses, I wonder what is the case in India. after a few years, the number of dissatisfied home owners might increase. This will become evident once the real estate boom slows down and the value of their property drops.
Angry homeowners in the US who bought homes, and found them to be structurally problematic have taken to the internet.
The Internet has rapidly become an outlet for frustrated homeowners to chronicle their bad experiences with new homes they have found to be structurally defective. Homeowners can now post complaints, discuss legal options, and warn future buyers on at least a dozen builder-directed "gripe sites," with names such as www.crapconstruction.com and www.khovsucks.com. (Link)
This is the expected fall out of a boom in the housing market, more so if customers are not patient and demand quick delivery of homes. In the construction business, the level of technology determines the shortest time span required to build a house/flat. In a market where the buyers are impatient, there will be some sellers who will be willing to deliver houses quicker than the minimum time as determined by the level of technology, therefore they will have to cut costs.
Secondly, if there is a boom in the housing market, the cost of raw materials will increase. If the seller does not have adequate clauses to pass this onto the buyer, then the seller will cut corners to reduce his losses from increasing prices.
I reckon that either of these two factors led to faulty constructions in the USA. If this is the case in the US, where builders give some form of guarantee for the houses, I wonder what is the case in India. after a few years, the number of dissatisfied home owners might increase. This will become evident once the real estate boom slows down and the value of their property drops.
