Why is RWD Palm & RWD Fern in Medavakkam not selling?

When they started RWD Palm in 2006, it was all glory when you visit the project. A walled community, only 170 houses, very nice model house, rightly priced, amenities from Swimming Pool to grocery stores in the community, a neatly finished model house, completion in 8 months, etc, etc. Come to present day. Its nearing 4 years and the project is not complete. Whats worse is they still have few houses to sell and no one is ready to buy with RWD. What went wrong?

(*) RWD is an immature company when it comes to residential projects. They do have constructed few commercial buildings, but residential buildings are a different case. Managing a commercial project is much easier, because you have only one customer for the whole building. In case of residential housing project like RWD Palm, each of the house owners booked at a different time. They had different preferences in interiors and had their own modifications. RWD couldn't simply manage all these houses which were coming up in different phases. One house might have gone to plastering stage, while the other one would have started digging for the basement. Essentially, the material management and personnel management becomes a little tough and they had no clue of how to manage - leading to inevitable delays

(*) Though the both newspaper & online advertisements were really nice and the stalls in the exhibitions were good, the word-of-mouth mode didn't work well. If I'm right they don't have any happy customers. Even my name is listed as a happy customer in the site, but believe me, I'm not a happy customer. Any prospect who talk to few of the the existing owners, would simply walk away from the project.

(*) RWD was too greedy. Only for the first phase of houses they had it rightly priced. Rest of the houses were way too high. A 1100 sq ft 2 BHK was charged at 50L. One cent land costs 3L to 5L in that area. Add Rs 1,000 to Rs 1,500 per sq ft for an engineer / construction company to build a house on that land. You do the math. The same house can be done in 25L to 30L. Did I mention that no need to wait for years and you can build it in 4 months flat?

(*) All the promises were broken. They advertised and promised that the RWD Palm project is a small community of 170 houses only. But then later, they introduced RWD Fern - the flats in the project to make more money. That increased the crowd in the community. They said all the amenities will owned by the Owners association. But it didn't happen that way. The Swimming Pool, Gym and other amenities are owned by RWD. Whats worse is, still after paying the a membership fees of Rs 20,000 to Rs 1,00,000 (depending on when you booked the house/flat), you have pay monthly Rs 600/- in the name of maintenance to use these facilities.All the Unisex Saloon, Cafeteria, and other few blah, blah blah they mention in the advertisement (even in the latest ad in Sep '09), doesn't even exist inside the compound.

(*) They act weird and have their own dumb reasons. They never think of the people who live there. The best example are the power crisis and water issue. With this attitude towards the customers, there is no wonder they are no selling the houses and apartments.

Anyways, The RWD Palm & Fern in Medavakkam is a huge flop for them. Unless they realize the mistakes from the past and correct them, their future projects are also going to be similar disaster.

Model Real Estate Regulation Act

From The Hindu.

The Union Ministry of Housing is proposing a Model Real Estate Act. Under this act any construction less than 1000 sq ft has to be registered with this authority before it begins. The promoters have to submit all approvals, plans and other details along with 5% of the total cost to the authority. Subsequently it has to submit all the advertisements, whenever they are published. The authority will manage and violations will be publicized. If the quality of the construction is not good or the promises not met, then the promoter will be black listed.

Sigh! If only this has been there from the beginning, lot of people like me would have been saved. The act is still in the draft stage and will take an year or two to become a rule. I wish this materializes soon without any delays. This might put an end to the builders taking the customers for a ride.

Questions to ask RWD marketing people

If you are looking to buy a property in Medavakkam, Chennai and zeroed in to RWD Palm villa or RWD Fern flat, hold on. Thanks to on going global crisis and the downtrend of real estates, you can negotiate and bring down the prices to 2/3 of the value they quote (Rs 2,999 to Rs 2,000 per sq ft) I'll give you few questions to ask. Take a printout of this and ask the marketing people one-by-one. Look at the response and then you can probably bring down the price by another 500 bucks. Or even more if you are good negotiator!

• Initially, did you promise the owners of the villas that there won't be any apartments and the entire site is only for the RWD Palm? Then why did you break the promise and added the apartments inside the complex?
  
  
• It seems that many of the villas had quality issues, esp the water is leaking from the tanks & roof into the houses. Is that true?
  
  
• Is it true that the most of the RWD Palm villas were delayed for more than 1 year? 
  
  
• In your advertisement in December 08, you said RWD Fern will be completed in 12 months. But now in September 09 you say it will be completed in 8 months. Does it means its running into delays already? How do I trust you to finish it in another 8 months?
  
  
• In the same December 08 ad, you said the special price of Rs 2,999/- per sq ft is applicable only for the first 50 customers and applicable only for those who book on that weekend. Now in September 09 you are still quoting the same price. Is that you have not even sold 50 apartments or the prices of your apartments have already gone down due to the delays and quality?
  
  
• For how many villas did you pay the penalty amount as specified in the agreement?
  
  
• If RWD Palm is called a gated community, why are the roads, childrens play area, jogging track, park are owned by Municipality?
  
  
• Despite every resident paying club membership of 1L, why is it that RWD will own the Gym, Swimming Pool and other amenities? Ideally shouldn't it be owned by the Owners association?
  
  
• Why is that every resident has to pay the maintenance of the amenities owned by RWD? Why can't RWD charge only the people who are using the facilities?
  
  
• It appears that the water from the common well is stopped by RWD for no reasons. Why is RWD not getting water connections from the Panchayat?
  
  
• The transformer is already maxed out with only 100 houses in RWD Palm. One additional transformer is added to cater the current need. If more people move in, especially when RWD Fern is completed, we will definitely need another transformer. When are you installing it?
  
  
• Even after handing over nearly 100 houses, why is RWD refusing to form the Owners association?
  
  
• Is it true that someone has filed a case against RWD in the Consumer Court?
  

Delays in RWD Fern, Medavakkam Project

If you are in Chennai, you would have very less chances to miss the 4 page exclusive advertisement in The Hindu Property plus on Dec 20th 2008 for the "luxury budget apartments" - RWD Fern in Medavakkam. Ignoring the nice oxymoron, have a look at the key features (click the images for a bigger picture):

 

"Delivery in 12 months", that is what they claimed in the ad. 10 months have gone and you would think that the project would have been nearing completion now. But look at the advertisement in the same The Hindu Property plus on 5th Sep 09:

Yes, now they say that the completion would take another 8 months! Ha ha. Delays are nothing new to RWD. When they started the Palm project (in 2006) the assurance was for 8 months, but they kept on dragging it for years to complete the houses. The project has 170 houses, and as they claim from the above advertisement, only 100 of them are complete (actually its only around 75. Nearly 100 houses are still incomplete - thats over a delay of three years and counting) Judging by the delays they made for a ground +1 floor project of 3 years, this project with ground + 4 floors will easily take 5 years for handing over the keys.

In case you missed the other points, the original advertisement said the cost is Rs 2,999/- only per sqft and that too its only for the first few customers who do spot booking on that weekend. I told you already that they will bring down the prices, as they look very high. Almost an year later, since there are no takers, the price they quote in the advertisement is still Rs 2,999/- and its negotiable to a great extend. They won't quote me the real selling price, so I asked my friend to enquire posing as a prospect and check on the prices. When he negotiated, they came down to Rs 2,000/- per sqft. Probably they might come more if you are a tough negotiator. No matter how cheap you get the apartment for, remember, when you get is more important!!!