Real Estate Bill – Protecting consumer interests

File picture of a construction site taken from http://www.thehindubusinessline.com

On 9^th November 2011 Ministry of Housing & Urban Poverty Alleviation (MHUPA) of Government of India released a draft real estate bill to regulate the real estate sector which is largely unregulated so far. MHUPA needs to be appreciated for their efforts and for showing intent to protect the consumer interest. Once again, it’s time for the political class of this country to stand-up and show some political will that promotes public good. The bill will be tabled in the parliament in winter session and MHUPA has invited comments from industry and civil society for a period of 1 month. The draft real estate bill is a small 29 page document and responses can be sent to responseonrealestatebill@yahoo.in

This bill is a breath of fresh air since the hapless home buyer is effortlessly muscled down by real estate developers. It was long overdue and am glad that finally at least the draft has come.  On the face of it, the real estate sector has welcomed the move behind a façade that some unscrupulous, fly-by-night developers indeed cheat the consumers and the bill will help restore credibility to the sector.  However, almost all, including the most reputed players in this sector quietly continue to squeeze the hapless home buyer in many ways that we are all aware of.

Let’s discuss the most vicious of the exploitation case and then I will quickly summarize what I have understood about the bill, and then close this post. 

The most vicious case according to me is when the developer accepts part-payment from the buyer and commits a delivery date for handing over the possession to the buyer.  However, when the developer is unable to make the full sale of the property he intends to develop, he holds to payments he has received and completely stops work (or works extremely slowly) on property development. Worst thing is that, the buyer, who has made the payments, is pestered by the banks for their pre-EMIs and the developer refuses to return the money. So the hapless home buyer, for no fault of his, continues to lose money and doesn’t even get his dream home. On the other hand, if the buyer defaults on payment he is charged a 18% to 24% penalty. Why should the developer’s inability to sell the remaining property become a buyer’s liability?

Now let’s discuss why the developer is not able to make the sale and achieve financial closure for the project. This is largely because he is legally safe and does not have a legal obligation to deliver the house on time. It’s sort of only a moral obligation which developers hardly care about.  The developer exploits this loop hole by dictating a certain price for which he finds no buyers.  But he still holds on to that price because he wants to protect his margins and continues to legally hold on to other people’s money without any liability. Why on earth would he then hurry to finish the sale? After all, he is not the one who is losing any money. That’s precisely the reason why real estate prices hardly ever reduce in metros like Mumbai. The supply-demand argument IMHO is a hogwash and largely untrue.  The real estate sector in India is largely run like blue line buses in New Delhi where the driver and the conductor stop and pick up from anywhere and wait until the bus is full with passengers. Instead it should be run like the BEST buses in Mumbai, where the bus halts only at the designated stops and is quickly on its way. 

Now, the real estate developer community is a bunch of smart people and they realize the damage to their reputation if they continue doing so for a prolonged period. So they invoke this strategy only when there is a slowdown in the economy. During boom time they have enough buyers and hence have enough motivation to complete projects, however during slowdown they adopt strategy mentioned above and use the projects completed during boom-time as their shield to deflect questions on their integrity.  For many, buying a house is once-in-a-lifetime event and the buyer is blissfully unaware of all these strategies and gets needlessly grinded.

So, how does the bill change or at least propose to change all of this?

The salient features of this draft bill are :

• Each phase of the project will have to be registered separately with the government (So now the developer won’t be able raise any unauthorized structures and sell them to naïve buyers)
• The builder will have to submit details such as size of plots, layout plan, and facilities proposed in the project. (So now, a builder will have to build all the fancy things that he promises but never ends up building.)
• Builders issuing misleading advertisement for sale of flats or unnecessarily delaying projects will also come under scrutiny
• Three years imprisonment or a fine up to 10 per cent of the project cost, if any builder “wilfully” develops or constructs projects without first registering it and obtaining a certificate from the proposed Real Estate Regulatory Authority (No construct-it-first-and-regularize-it-later business – a straight attack on corruption)
• 70 per cent of the amount taken from allottees from time to time will have to be deposited in a separate (bank) account and can be utilised only for that particular project.(No more juggling money and also it will prevent errant builders from collecting money when they are not authorized)
• The bill only deals with regulation and development of real estate. It doesn’t say anything about pricing (So you still can’t do much about obnoxious prices, but hopefully once you enter a deal you will have legal protection from this bill and a weapon to nail the errant builder)

I would say that’s a good start. Am keeping my fingers crossed and hoping that the parliament passes the bill without any dilution and consumers get their long awaited dues and don’t have to feel helpless in front of powerful builders.

That’s all I have for today.  Would love to hear your thoughts and opinions. Please, do comment.

Computing learning styles of the past decade

A decade in computer industry is a long time. Many things relevant a decade ago are obsolete today. So comparing what I studied, with what today’s collegians study, is meaningless. However, what is comparable is the method of learning computing.  I have had the good fortune of meeting lot of people of all ages in the field of computing (read computer science, IT, software, hardware etc) and I have had something to learn from many of them. From those interactions, I noticed how various individuals had similar or dissimilar computing habits than mine. After giving some thought to it, it was easy to correlate the habits to the era in which they learned computing. Once I could understand their habits, I could predict or at least anticipate their next action with fairly good success ratio. This proved useful in building good professional relations at work.

In this post, I am going to make observations about changes in computing technology and how it has affected learning styles of people. I want to keep it short and simple, so I am going to exempt the times preceding the era in which I learned (studied) computing. Since that’s approximately the year 2000, this post is going to contain comments relevant between then and now (2011).

So let’s start the comparison

Factors	Parameters	Then (around year 2000)	Now (2011)
Economic	Affordability	A PC used to cost 10x to 15x monthly saving of a middle class Indian family	Typically, costs less than 3x monthly savings of a middle class Indian family
	Availability	At least a month of wait time	Immediate availability. At worst, next day delivery
	Maintainability	People used to opt for maintenance plans	Hardly anyone opts for maintenance plans in PC segments, but expect 100% reliability
Social	Status	Considered luxury	Considered necessity
	Primary consumers	Kids for gaming and students and professionals for institutional work	All kinds of people for plenty of different kinds of usages
	Wow factor	Tremendous	Almost zero
	Special attractions	Internet	Broadband, VOIP
Technology	Computer sizes	233 MHz processor, 64 MB RAM, 1.2 GB HDD, 56 Kbps modems	3 GHz processor, 2 GB RAM, 1 TB HDD, 2 Mbps broadband connections
	Operating Systems	DOS or Windows 3.1 / 95 / 98	Windows 7 / Linux / Mac
	Typical applications	Documents, Spreadsheets	Browser-based

So it’s fair to say that a decade ago computing resources were scarce and had to be hard-earned whereas acquiring computing resources is easy pickings today. It’s basic human psychology that hard-earned resources tend to get valued more than the ones acquired without much hard work. Naturally then, the returns that one gets on it, is proportional to the value that one places on it. In the next table let’s substantiate the efforts part of the equation.

Factors	Parameters	Then (around year 2000)	Now (2011)
Pedagogical	Knowledge Acquisition	Students used to refer tens of books and compare and contrast literature within. Computer books were costly, hence people used to subscribe to libraries and photocopy parts of books they wanted to refer	Mumbai university has “text-books” for computer science engineering courses (what a pity). I seriously doubt if such a system can produce students who can objectively evaluate merits and demerits of comp sci concepts
	Technology-enabled knowledge acquisition	There were no Google, Wikipedia or blog sites to learn from other people’s experiences	Everything is available at click of a button. Absolutely zero efforts in acquiring knowledge resources
	Knowledge retention and reproduction	Students used to do projects which reflected the concepts one had studied. Some of the projects that me and my friends did in our college days were ·         MathCAD library ·         Multi-tasking in DOS ·         Chess programming ·         Code beautifiers ·         C to Basic conversion etc.	Today’s projects are much application oriented and very few systems oriented projects are original work for e.g. ·         Hotel management system ·         Railway reservation system ·         Compressing JPEG images etc.

The Outcome

As a result of the hard-work, time and money spent in learning the science of computing, a student graduating from engineering college, a decade ago, would be brimming with confidence and eager to apply his theoretical knowledge in solving the real world problems. Also, because of his deeper understanding he is well-versed with the concepts and can objectively evaluate merits and demerits of a computing solution.

On the other hand, because of his focus on applications, an engineer who graduates in today’s era is more adept at aspects like Usability and domain-specific things. However, when such an engineer is scratched beneath the surface one sees poor fundamentals and lower levels of confidence. This corroborates with my observation that instead of knowing what he can offer to the world, he is in search of doing a course on the next in-thing like a new language or a new technology. So now, after graduating, he is thinking of spending money instead of earning money, to stay relevant

If I come across as saying - Cooking one's own food is better than eating cooked food - then let me be more explicit here. I am just saying that the value of the food is directly proportional to the hunger one has. Staying hungry is the key here.

My Verdict

According to me, various socio-economic and technological factors have severely impacted the learning approaches towards computing science.  The seriousness and the formality required in studying the subject is quickly getting lost in a world which needs direct applications and / or commercialization.  In the process, it has actually widened the skills gap instead of closing it. As a consequence, we have more people who can use a finished product and less people who can actually build a good product and that’s dangerous in the long run.

By way of analogy, I say, engineering a car and driving a car are two different aspects of the same car. Both are important in its own rights, but I am strongly biased that students who study computing science should engineer the cars and leave the driving to others who have not formally studied the subject.

DISCLAIMER: - These are vast generalizations based on personal observations and exceptions exist.

Trip to Smoky Mountains – July 2004

Last weekend was American Independence day long weekend. We had 3 days off and we planned a trip to Smoky Mountains. Smoky Mountains is located on the border of South Tennessee and North Carolina.

 

We started early morning on Saturday, 3rd July in a 2004 Nissan Altima. It was a 380 mile journey. We comfortably covered around 365 miles in 5 hours. The last 15 miles took us 2 hours. To top it all me and my friend Suneel had made the hotel arrangements and both of us forgot the name of the hotel we had booked. As hard as we tried to recollect, success kept eluding us. We thought there would be a few hotels in the area and decided to ask each of them if we were booked with them. As we approached within half a mile of our destination we saw at least a hundred hotels, motels and inns. Not kidding. Suneel had the hotel reservation confirmation in his mailbox and we frantically tried reaching people who could access Internet and look up the name for us. Finally after calling 15 - 20 of our friends we could find one who could help, and finally we crash landed into Howard Johnson Inn.

 

Next we had some lunch substitute and set out to roam Gatlinburg. First we visited the office from where we had booking for our Rafting Adventure for Sunday. We took the maps, filled out forms and were eagerly awaiting our turn to raft.

 

The night I slept dreaming about the rafting adventure and I was feeling almost wet. The wait was over when the dawn broke and we hopped in our cars. We had to travel 40 miles before we reached the river. It was an extremely scenic route up and down the wonderful range of smoky mountains. There were deep valleys or dense forest on one side and steep mountains on the other side. I enjoyed driving so much that I could have had a higher Job Satisfaction Index than Micheal Schumacher.

 

Next we were in rafting gear, in the raft and ready to go. It was a beautiful morning, the temperature was a pleasant 70F and the waters of river Nanthala were cascading at rapid speed making a nice rhythmic sound.  I closed my eyes to capture and treasure the moments for a lifetime. It was so beautiful. Finally, we began rafting. It was my first rafting experience. As we came more and more downstream in the raft, the water currents started getting more and more rapid. The rapidness of these water currents is what is used to describe the level of difficulty in rafting. The higher the level, the higher is the risk. We had Level 2 and Level 3 in our course. Level 5 and beyond have high chances of fatality.

 



In high spirits as we started our adventure



We crossed all the Level 2 currents and enjoyed them thoroughly and there was this last Level 3 before we would finish. As we fast approached this last rapid, we were in high spirits. Just then on one of the turns there, our raft hit a rock on the right side. All the folks on the right side fell on people on the left side. 

 

Where am I?



 Just then a HUGE current of water hit the raft hard and me and Venky were thrown in the water. I still remember the split second when that powerful jet of water splashed with a thud on my chest. The impact was so great that it lifted my feet up in air for a second or two. I was neither in the raft nor in the waters that time. I was suspended in mid-air. I fell in water and hit the rocks 6-8 feet below me, thanks to life jacket I resurfaced quickly. 

 

Nose-and-toes-out



For some time I was unable to breathe and that made me panic. When I resurfaced, I saw Venky floating next to me. Next I looked at the raft and saw that other 4 of my colleagues were safe and in the raft.



The safe-4



My instantaneous reaction was to try and swim. Before I could stroke even one arm, the water current used to throw me 5 - 10 feet. It was impossible to swim. By this time I had stabilized and the panic was all gone. I knew I had to get across to the right shore even though left shore was more closer because the stream was moving to the right. Venky is a big man and thought he could force his way to the left shore and he almost made it before the shore eluded him and he was thrown midstream. I knew my physical capabilities and and went straightaway towards the right shore. I could comfortably breathe now and my only task was to steer towards the shore. However doing that backwards was more tougher than I thought. They instruct you to float with Nose-and-toes-outside position when you fall in water. What that position does is, it gives you a comfortable position to breathe and prevents your legs from being stuck in the rocks because now they are pointing skywards.  

Now it was difficult to have a sense of direction, so what I did was take a breath -- look behind for rocks on my way and paddle towards the shore. Repeated this for a almost 3-4 min. In between, there were other rafters who tried to come close and rescue me. One raft came within 6 inches of me before currents forced it other way. I guess at that moment I understood what it means to "reach out to people" (pun intended). In that short span of 3-4 min trailers of so many movies flashed in front of my eyes. When I missed that outstretched hand by 6 inches, I remembered Stallone of Cliffhanger. The water was freaking cold at 42F/ 5C and I remembered Titanic and so many more ...

 

Finally I managed to come close to the shore and one of the rafts reached me and pulled me towards the shore. In the mean while it had started to rain torrential, almost a minute after we had fallen in the water. The rain drops were hurting. When I reached the shore my teeth were clattering out of cold, but I was feeling glorious. My whole body was numb for a while and I realized I had bruised knees and a cut left palm. People congratulated me on reaching the shore and told me that I did a good job at keeping cool and doing the right thing.

 

In the meanwhile Venky was still going downstream very rapidly. I could see, understand and feel what he was going through. For a moment when I saw him still in the middle of the stream, my heart sunk. We were getting afraid since the Level 5 course was just probably a couple of thousand feet ahead and he was heading in that direction. Luckily for him he hung tightly to a rock and people on the shore threw ropes at him like a rodeo. He grabbed one and was pulled out. The ordeal was over for Venky. After he came to senses, even he felt jubilant and thrilled.

 

At the end of it, it was me and Venky who enjoyed an array of emotions like excitement, fear, panic, thrill, jubilation, happiness and relief and over the next 30 minutes we successfully managed to convert others' feeling of pity for us into jealousy. Wow it was fun.

Phew !. This was only one day. The second day we went to Gatlinburg and had some more adventure sports, most notably ice skating and alpine rides. Will describe that some other time