In our country too, the consumer durable industries have grown rapidly on the back of professionals. However, the real estate business still lacks the professional touch. This, despite the fact that the seller's market of the mid-90s has now turned into a buyer's market. Efficient marketing was not so much needed earlier as now in a buyer's market, where competition is intense. Efficient professional marketing is the need of the hour.

Professionals in this industry face two major challenges: the social obligation to provide housing at reasonable price to the middle and lower middle income groups; and to provide profits to builders and developers with their innovative ideas and aggressive marketing strategies. A professional should know the history of property business not only in his own country but also in various other countries. He has to understand the cyclic nature of the business and the price trends. He should also have knowledge of undeveloped areas with good potential.

For example, as soon as the government planned the development of Konkan Railways, many builders started digging into the details of the plan to understand the route of the railways and the locations of railway stations in order to purchase area nearest to the stations. A professional has to understand the blueprint of all development plans of the government. He also needs to get acquainted with the legal procedures involved in property dealings.

Today, the largest number of cases pending in courts pertain to land and property disputes. A professional in the real estate business must find out why all corporate groups in this business are making losses despite their professional approach whereas builders are reaping profits. Many companies in this sector have failed owing to mismatch of funding, booking and receipt plans and implementation of their constructions plans. For instance, if a builder undertakes two construction works simultaneously, the funding of both the projects have to be aligned properly. If construction on one site is nearly 80 per cent complete but booked upto only 20 per cent and the second site is booked upto 80 per cent but only 20 per cent complete, it could give rise to serious problems regarding the cash flow. Builders are known to divert funds from one project to the another, thereby adding to their woes. The problem aggravates when rates of the sites start falling and costs start rising. Thus, the decision of a professionalis of much significance.

A professional has to be very cautious in his property dealings. A property has to be free from encumbrances and should have clear title. It should also have clearance for required floor space index (FSI). There have been number of cases in which buildings belonging to powerful politicians and industrialists were razed down after completion of construction work.

A few years back, a well-known building `Pratibha' at Warden Road, housing several top industrialists including Dhirubhai Ambani of the Reliance group, was in eye of the storm because of illegal construction. The controversy was brought to an end by razing the top eight floors which were allegedly illegal. There is also the recent case of a building in Pune constructed by the son-in-law of the former chief minister of Maharashtra Manohar Joshi. The construction was demolished after a long period of controversy. In this case, the plot reserved for municipal use had allegedly been used for commercial purposes. Thus, it is very important that the plot on which a building is to be constructed has clear title and FSI clearance.

For a professional, quality construction is also a major responsibility. Because, finally, it is the quality of a construction which reflects a builder's brand image. Bangurs, once ranked third among the top industrialists of India, had a large piece of land in Goregaon where they built Bangur Nagar. But they do not have a respectable image as builders because of the poor quality of construction. In Bangur Nagar, ceilings of flats have known to have crashed. And in spite of having bought a big land of more than a million square feet at a price of Re 1 per square feet, the group's name is nowhere close to the Rahejas who started from the scratch and are among the leaders in the industry today. The basic difference is of the quality. Rahejas became synonymous with quality construction because they continuously worked at improving customers' value.

Thus, its high time the industry started employing professionals.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.