The Housing Mismatch: Why the Flats Being Sold Are Not Always the Flats Buyers Want

Developers sell one kind of home while households, a few years on, ask for another. That mismatch is built into housing. Below we follow a project from the land deal to the keys to show where the gap opens, then set out the protections RERA offers and a short list of things to verify before booking in Bangalore.

Why Housing Cannot React Quickly

When tastes shift, a phone company retools within months. A residential builder is stuck with decisions taken long ago, and the end product stays on one plot of land for good. Three limits explain most mismatches: the time a project takes, its fixed address, and external events nobody controls.

Following a Project Through Time

First comes land, bought or tied up by agreement. Then the developer draws the scheme, wins sanction for the plan and registers it with RERA. Only after that do sales begin, with construction, an occupancy certificate and handover following in order.

What gets built is settled at step one. Suppose 3 BHK flats look scarce this year: the developer plans a scheme made of them, and when the towers finally open, shoppers may be hunting for something smaller or larger. In reverse, a sudden surge in demand for one type meets supply that is still years away. Projects already offering that type sell faster, and ready resale flats become more valuable.

A date promised in public

Section 4 of the 2016 RERA Act has the promoter declare the period for finishing the project or a phase of it, and the state RERA portal displays this with the registration. Section 6 lets the authority extend the period for force majeure, and in reasonable circumstances by additional time adding up to no more than a year.

Why Plans Resist Revision

Once buyers have signed, the drawings are close to untouchable. Section 14 insists that the project be built to the sanctioned plans, layouts and specifications. A change to a particular buyer's apartment needs that person's earlier consent, and anything else in the blocks or shared areas needs written consent from a minimum of two-thirds of the allottees.

The rule keeps any buyer from ending up with a scheme different from the booked one. It also means a half-sold tower cannot be switched to a more fashionable format. Fashions do move: balconies grow, study rooms become standard, kitchens are redesigned. A scheme drawn four years back can seem dated beside the launch next door.

Homes Cannot Follow the Crowd

Empty flats in a distant suburb do nothing for a household that works and studies in another quarter. City-wide totals therefore blur local shortages and surpluses.

In Bangalore, every side has different employers, so the sub-markets act independently. Consider Whitefield and the eastern tech belt, the airport corridor near Devanahalli, and the southern cluster at Electronic City. A burst of launches in one alters the options and negotiating power for buyers there, while the others carry on unaffected.

Land makes it worse. Big plots with clean title and road frontage have become rare in old localities, so builders go to the fringes. People insisting on the centre end up chasing a few homes, and the outskirts take most of the new stock.

Events Nobody Controls

Buyers can respond to news in weeks, but supply needs years. Cheaper loans raise what a family can pay immediately, whereas the homes meant to meet that demand come much later. A hiring freeze does the opposite and leaves schemes planned in good times selling into bad ones.

Loan rates and job security matter most. Other forces also play a part:

• Approval speed for plans, khata and occupancy certificates.
• New transport links, such as metro lines and ring roads, that redraw where people are ready to live.
• Movements in what land, steel, cement and labour cost, which decide the viable price band.
• Tax or stamp duty changes that alter the total cost of buying.

Spotting the Mismatch

A buyer comparing projects will see it in several ways. Some size or price bands are full of unsold flats while others are sold out. Older schemes with tight layouts are priced almost like newer, better-planned ones.

Ready flats carry a premium among people who hate waiting, and resale prices climb where hardly any new project can be built. Later phases are sometimes relaunched with flat sizes unlike the first. These signs are prompts, not verdicts, and each only invites the question of why a particular home is on offer and whether the reason affects the buyer's plans.

A Buyer's Response

Forecasting demand is impossible, though the design of a home can be assessed on its own. A sensible layout, plenty of daylight and usable rooms stay attractive through most cycles, while homes that shave room sizes to reach a low sticker price suffer first when preferences move. Practical steps:

1. Start with carpet area and room sizes, leaving the headline price for later.
2. Check which other projects are launching in the locality, since they will compete at the time of resale.
3. Find the completion date on the RERA registration, plus any extension granted.
4. Ask which flat types in the project are moving quickly and which are slow.
5. Compare a ready home with an unfinished one on full cost, including rent paid in the interim.
6. Use the EMI calculator with a rate a point or two higher than today's.

Intending to stay a decade or longer also helps, because a single poor year at launch or handover then matters less. Time smooths out one bad cycle.

How RERA Limits the Downside

The Act does not make buildings rise faster. It does cap what a buyer can lose along the way:

• Section 4 places 70% of the money received from allottees in a dedicated bank account, meant solely for land and construction expenses.
• Section 14 also binds the promoter to repair defects in structure or workmanship reported within five years of possession; the repair must come free of cost inside thirty days.
• Section 18 lets an allottee leave a late project with a refund plus interest, or stay and collect interest for each month of delay.

Money leaves that account only in step with the percentage of completion, as certified by a chartered accountant, an architect and an engineer. A buyer's funds therefore follow the work done. Anyone can inspect the registration number, quarterly updates and declared completion date on the state RERA portal.