Perception and Expectation of Customer in Real Estate (Ghaziabad)

BIRLA INSTITUTE OF TECHNOLOGY

NOIDA

Assignment

perception and expectation of customer in real estate

Submitted By:-

IMBE/4501/12 Sheeba Sardana;

IMBE/4507/12 Deboshree dey;

IMBE/4513/12 Shubham Agarwal;

Acknowledgment

It is really a matter of pleasure for us to get an opportunity to

thank all the persons who contributed directly or indirectly for the

successful completion of the project, perception and expectation of

customer in real estate.

First of all we are extremely thankful to my college Birla institute of

technology, Noida for providing us with this opportunity and for all

its cooperation and contribution. We are highly thankful to Mrs.

Vandana Sharma maam for giving us the encouragement and freedom

to conduct our project.

We are also grateful to all my faculty members for their valuable

guidance and suggestions for my entire study.

And we are also thankful to real estate broker for giving us full

support to conduct our project.

Content

Abstract

Keywords

Introduction

Overview of real estate in india

Review literature

Objective of the study

Statement of the research problem

Research goals

The study area

Research methodology

Scope and limitations

Finding and analysis

conclusion

Abstract

india is an over populated country and day by day population is increasing rapidly

which created the housing problem. Land prices skyrocketed. Due to high price,

insufficiency of land, high cost of land registration, and high price of building

materials, people are now not interested to buy a land for building their own

house. This report shows the customer perception and expectation in different

dimensions - budget, types of apartment, size of apartment, favorable location

in Ghaziabad city, favorable facility in an apartment, factors related to purchase

decision, factors in selecting developer company, how customers determine about

quality, company brand selection, desired services from a particular company,

preference between apartment and land, the risk factors perceived by the

customers. Geographically, this study focuses on the Ghaziabad, and can be

considered as a little contribution to the understanding of the real estate

industry, particularly in Ghaziabad and particularly from the customer

perspective. But the findings may be relevant for other cities also. Real estate

companies and developers can take these factors into consideration while making

their business strategy and marketing strategy. On the other hand, Policy

makers can take the customer perception and expectation cited in this study,

into consideration while making related regulatory policies and framework.

Keywords

Real Estate, Ghaziabad (up), Customer perception and expectation.

Introduction

India is an over populated country and day by day population is increasing rapidly

which created the housing problem. Land prices skyrocketed. Due to high price,

insufficiency of land, high cost of land registration, and high price of building

materials, people are now not interested to buy a land for building their own

house. Thats why they turn to real estate companies who are providing flats or

apartments. In response, real estate business has enjoyed a boom over the years.

In all over the India, there are now companies growing up like Ansal , wave etc.

these companies also spreading throughout other divisional and district towns.

There are some secondary literature based articles like real estate financing by

Sarkereal. (2011). But there is little research, specifically primary data based

one, - what customers are looking for, why they are choosing particular

apartment, particular company and for what factors.

Overview of Real estate industries in India

Real estate in India continues to be a favored destination globally for investors,

developers and non-resident Indians (NRIs), driven largely by investor-friendly

government policies and increasing Globalization. The second largest employment

generation sector after agriculture, real estate contributes about 6.3 per cent to India's

gross domestic product (GDP). The foreign direct investment (FDI) in the sector is

expected to touch US$ 25 billion in the next 10 years from its current US$ 4 billion.

The sector's progress is driven by factors such as rapid Urbanization, a growing trend

towards nuclear families, positive demographics, ruralurban migration, ever-developing

infrastructure, higher income levels and housing demand. The real estate sector, with its

growing investment opportunities, is expected to post annual revenues of US$ 180

billion by 2020.

Market Dynamics

The real estate sector in India is witnessing rapid growth in the residential, commercial

and industrial segments. Real estate development, once restricted to bigger cities, have

shown marked progress in smaller cities and towns owing to availability of banks loans,

higher earnings and improved standard of living.

The real estate sector of India is projected to post annual revenues of US$ 180 billion

by 2020 against US$ 66.8 billion in 2010-11, a compound annual growth rate (CAGR)

of 11.6 per cent. The demand is expected to grow at a CAGR of 19 per cent in the

period 2010-2014, with Tier I metropolitan cities expected to account for about 40

per cent of this growth. As of now, Mumbai, Delhi-National Capital Region (NCR) and

Bengaluru cater for 46 per cent of total office space demand in India. This demand is

expected to be rise sharply in Tier II cities such as Kolkata and Chennai in the period

2010-14.

Today, Delhi-NCR accounts for about 30 per cent of the total mall supply in India.

About 53 per cent of demand for total mall space is projected to come from the

country's top seven cities, namely Delhi-NCR, Bengaluru, Mumbai, Kolkata, Pune,

Hyderabad, and Chennai, in the period 2010-2014.

Investment Opportunities

The Indian retail realty sector is projected to grow at around 15 per cent year-on-year

over the next 3-5 years as against a 12-13 per cent nominal growth of India's GDP

estimated by the International Monetary Fund (IMF). If the sector does indeed manage

the aforementioned growth, it will touch Rs 34 trillion (US$ 544.73 billion) by 2016.

India's office space stock is estimated to rise by 40 per cent to 642.2 million sq ft by

2017, according to a report by real estate consultancy Knight Frank India. The current

Indian market offers some of the most competitive rates in the Asia-Pacific region,

according to a report by property services firm DTZ. The report also states that Indian

cities will have some of the fastest rental growths in the region over the period 2013-

17, but will remain among the most competitive.

The share of luxury retail space in India will be 1.4 per cent by 2015, according to a

report by real estate services firm Cushman & Wakefield. NCR and Mumbai, areas that

have embraced the mall culture, are the two most favoured destinations for luxury

retailers.

The construction development sector, including townships, housing and built-up

infrastructure garnered total FDI worth US$ 22,671.95 million in the period April

2000-August 2013. Construction (infrastructure) activities during the period received

FDI worth US$ 2,280.95 million, according to the Department of Industrial Policy and

Promotion (DIPP).

The following are some of the major investments in the Indian real estate sector:

1. Godrej Properties Ltd plans to invest Rs 9,000 crore (US$ 1.44 billion) in 15

new real estate projects in India over the next 10 years.

2. Unitech Ltd has signed a Rs 800 crore (US$ 128.17 million) deal to lease an 800,000 sq

ft space at one of its IT Special Economic Zones (SEZ) in Gurgaon, to multinational

human resource firm, Aon Hewitt.

3. NRI billionaire Mr Ravi Pillai plans to purchase stake worth about US$ 100 in a special

purpose vehicle floated by Pune-based realtor, Panchshil Realty. The investment will go

into the construction of Trump Towers and World Trade Centre in Pune, Maharashtra.

4. Infrastructure Leasing & Financial Services (IL&FS) Ltd has claimed a project worth Rs

244.46 crore (US$ 39.17 million) from realty firm Emaar MGF for construction work at

the latter's residential project at Gurgaon, Haryana.

5. French luxury hotel chain Sofitel, which is managed by Accor Group, is targeting 10

properties in India, mainly in major luxury destinations, in the next few years.

6. One of the world's top manufacturers of elevators, US-based Otis, is setting its sights on

the Indian real estate market. The pace of construction in India makes the country an

attractive proposition for such an investment. The company will be working with the Delhi

and Hyderabad Metro projects. The former has placed an order for 222 escalators for its

Phase III project, according to Otis.

Government Initiatives

According to the existing FDI policy, 100 per cent FDI in the construction development sector is

permitted through the automatic route. DIPP is looking at relaxing FDI norms further to

encourage investment. It has also proposed a reduction in the minimum capitalisation for wholly-

owned subsidiaries from US$ 10 million to US$ 5 million, and from US$ 5 million to US$ 2.5

million for joint ventures with Indian partners.

One of the major initiatives of the Ministry of Housing and Urban Poverty Alleviation (MHUPA)

is to provide affordable housing for poor people living in urban areas. The Jawaharlal Nehru

National Urban Renewal Mission (JNNURM) is one its flagship schemes, a reform driven

investment programme which started with the objective of creating economically productive,

efficient, responsive and inclusive cities.

The Real Estate (Regulation and Development) Bill, 2013, as approved by the Union Cabinet is a

pioneering initiative aimed at delivering a uniform regulatory environment to protect the

consumer, help in quick verdicts of disputes and ensure systematic growth of the sector.

Road Ahead

India needs to invest US$ 1.2 trillion over next 20 years to modernise urban infrastructure and

keep pace with the burgeoning urbanisation, as per a report (India's urban awakening) released by

McKinsey Global Institute (MGI). Demand for space from sectors such as education and

healthcare has opened up opportunities in the real estate sector. Also, growth in the number of

tourists has led to demand for service apartments. This demand in the tourism sector is

expected to generate 50,000 new hotel rooms over the next four to five years, across India's

major cities. Exchange Rate Used: INR 1 = US$ 0.0160 as on November 18, 201

REVIEW OF LITERATURE

In the words of Parasuramanetal. (1985), services have become more and more

important factor for organizations. Most service providers depends on

performing the services correctly but also others find services as an important

means of differentiation and creating better customer satisfaction. The problem

facing many real estate agents is how to meet their clients taste, retain them

and be able to gain competitive advantage over others. There is need

to know what the consumers actually value so as to meet their needs and

probably retain them.

In a study by McDaniel and Louargand (1994), the study revealed that all

services must respond to consumer expectation because consumers perception of

quality is an important part of the consumption decision. Therefore, the

customer must never feel ignored, unimportant or abandoned in service delivery.

Stewart (2008) noted that the most valuable, and often the most neglected

approach towards getting the edge over competitors is developing a better

understanding of the perspective of the concerned consumer and devising

strategies to increase their service quality. This will give the consumer

satisfaction and also encourage repeat business.

Parasuramanetal. (1985) in their pioneering work on service quality identified

some criteria for assessing service quality from the consumers perspective. These

criteria are: reliability, responsiveness, competence, access, courtesy,

communication, credibility, security, understanding/knowing the customer, and

tangibles. After further research, the authors came out with five basic

dimensions that the consumer of any service wants to have the provider meet

his or her expectations. These are in the areas of: tangibles, reliability,

responsiveness, assurance, and empathy. According to Parasuramanetal. (1990)

are the determinants of the perception of service quality on the part of the

consumer.

Omar and Schiffman (1995) Parasuramanetal. (1988) and Radwin (2000) all

reported that consumer requirements need to be known in order to have a

satisfied consumer, that is, the providers understanding of what the consumer

want and the providers ability and willingness to deliver it brings consumer

satisfaction.

Crew (1999) researched into consumer perception of the service offered by real

estate agents in Real Estate Institute of New Zealand. His findings confirmed

that buyers continue to choose a real estate firm because the firm had the

services, people or product (home) that they wanted. His findings also reflected

mixed results in terms of consumer satisfaction levels.

Sridhar (2001) observed that service quality is ultimately defined by customer

irrespective of organization internal quality specification. However, there is

problem of different levels of expectation, incorrect interpretations of

expectations, delivery of inappropriate service and failure to match expectations

with performed service. To ensure better service quality, the author advised

that providers should promise what can be delivered, attend to complaints from

dissatisfied customers and make services easily understood.

Thomas and Whitney-

Thomas (1996) identified communication breakdowns as the greatest barrier to a

positive working relationship. The authors agreed that the more involved and assertive

the consumer, the better the services.

From the foregoing, it could be deduced that there are some factors that bring

consumers satisfaction. The providers understanding of these factors and their ability

to provide same will lead to improved service delivery, enhance consumers satisfaction

and encourage repeat businesses.

Objectives of the study

The broad objective of this study is to develop an understanding of

the overall picture of apartment/flat market of Ghaziabad City with

particular emphasis to customers preference and expectation side.

The specific objective is to identify and gain insights about the

preference of the apartment buyers or customers while choosing the

apartments or the real estate companies.

Statement of the research problem

the problem of the study was to determine the customer

perception and expectation in different dimensions - budget,

types of apartment, size of apartment, favorable location in

Ghaziabad city, favorable facility in an apartment, factors

related to purchase decision, factors in selecting developer

company, how customers determine about quality, company

brand selection, desired services from a particular company,

preference between apartment and land, the risk factors

perceived by the customers.

Research goals

There were twelve main research questions used by us to conduct our study.

Q1. what is your price range for purchasing an apartment ?

Q 2. what type of apartment are you interested in ?

Q 3. how may square feet are you seeking ?

Q4. what type of location are you interested in ?

Q 5. how many facilities are you expecting in your apartment ?

Q6. what kind of factors effects you during apartment purchase

decision ?

Q 7. what are the dilemma you face when you are selecting a

developer companies ?

Q8. Do u considered about quality ? if is it then by what source ?

Q 9. which brand name apartment would you like to purchase ?

Companies have mentioned below?

Q10. what kind of facilities do you want from developer companies ?

Q11. if you have given two chooses between land and apartment what

would you like to prefer and for what purpose ?

Q12. what are the factors do you fear about purchasing an

apartment from real estate companies ?

THE STUDY AREA

The study area for this research is Uttar Pradesh-India. The city of Ghaziabad

has been chosen to be a representative sample of the whole country. This city

have seen the sudden spurt of commercial activities in terms of industrialization,

education, IT hubs in last 10 years (post 2000) and of course this has

contributed a lot in the sudden increase in the real estate/ property market.

These two destinations are in comparison with the top metro cities of Mumbai,

Delhi, Calcutta, Chennai etc. as the volume of economic activity in Ghaziabad

exceeds that of all capitals or towns in the country.

RESEARCH METHODOLOGY

The topic was selected because this is a very interesting one in

current context of India. Real estate market is booming, demand is

soaring, and shaping of industry is very fast. Real estate has become

a focus of citizen interest. The study was conducted in Ghaziabad in March-

April 2014. The focus group for this research work was mainly real estate

services to satisfy customers .we have taken 10 real estate surveying firms were

randomly selected representing total number of estate agency firms in the

study area.

A total number of 30 real estate

customer were selected by us. The study adopted self-administered

questionnaires as its data collection instrument. Each customer was asked to

complete a questionnaire. The questions focused on individuals perspective of

real estate agents. More specifically, consumers were asked to express their

views based on expectation and perceptions as a consumer in real estate.

Exploratory research

The method one used for exploratory research was:

1. Primary data

2. Secondary data

Primary data

New data gathered to help the problem at hand as compared to secondary data which

is previously gathered data . an example is information gathered by a questionnaire.

Qualitative or quantitative data that are newly collected in the course of research ,

consists of original information that comes from people and includes information

gathered from surveys, focus groups, independent observation and test results

experimentation.

Primary data is basically collected by getting questionnaire filled by the respondents.

Secondary data

Information that already exist somewhere, having been collected for another purpose.

Source include census reports, trade publications and subscription services. Data that

have already been collected and published for another research project (other than the

one at hand). There are two types of secondary data : internal and external secondary

data.

Descriptive research

Steps in the descriptive research:

Statement of the problem

Identification of information needed to solve the problem

Selection or development of instruments for gathering the

information

Identification of target population and determination of

sampling plan.

Design of procedure for information collection

Collection of information

Analysis of information

Generalization and predictions

Determination the sample plan and sample size

Target population

It is description of the characteristics of that group of people from whom a course is

intended . it attempts to describe them as they are rather than as the describes would

like them to be. I have selected the sample trough simple random sampling.

Sample size

This involve figuring out how many samples one need.

The number of samples you need are affected by the following factors:

Project goals

How you plan to analyze your data

How variable your data are or are likely to be

How many times a year you will sample each point

How much money you have

Sample size

we have targeted 30 people for the purpose of the research. The sample size is

influenced by the target population. The target population represents the Ghaziabad

region. The people were different professional background.

Sample technique

Simple random sampling technique has been used to select the sample .a simple random

sample is group of subjects (a sample) chosen from a larger group (a population).

Errors in the study

Interviewer error

Interviewer bias in the questionnaire method. Open ended questions can be biased by

the interviewers views or probing , as interviewers are guiding the respondent while the

questionnaire is being filled out. The attitudes the interviewer reveals to the

respondent during the interview can greatly affect their level of interest and willingness

to answer openly . as interviewers probing and clarifications maximize respondent

understanding and yield complete answer , these advantages are offset by the problems

of prestige seeking , social desirability and courtesy biases.

Questionnaire error

The questionnaire designing has to careful so that only required data is concisely reveled

and there is no redundant data generated . the questions have to be worded carefully

so that questions are not loaded and does not lead to a bias in the respondents mind.

Respondent error

The respondent error selected to be interviewed were not always available and willing to

corporate also in most cases the respondents were found to not have the knowledge ,

opinion , attitude or facts required additionally uninformed response errors and response

styles also led to survey error.

Scope and Limitations

This is a cross sectional study which might not capture the trend or

changes in customer attitude and preferences about the apartments

or real estate companies. This field based study was done only in

Ghaziabad. There are so many real estate developer companies in

Ghaziabad and all over the country, with huge and growing customer

base, different target customers, and with different business

strategies. So it might not be possible generalized about the overall

country scenario. The main field investigation was done two years

ago. So the year-of-investigation and year-of-publication time gap is

there as this market is changing over time.

SURVEY

Perception and expectation of customer in real estate

Q1. What is your price range for purchasing an apartment ?

20 30 lakhs

30 40 lakhs

40 50 lakhs

50 above

Q2. What type of apartment are you interested in ?

Studio apartment

Economy apartment

Duplex apartment

Semi luxuries apartment

Luxuries apartment

Q3. How much square feet are you seeking ?

900 950 Sft.

1050 1250 Sft.

1250 1350 Sft

1350 1550 Sft

1550 3000 Sft

Q4. What type of location are you interested in ?

Indrapuram

Vaishali

Vasundhara

Rajnagar extension

Gandhi nagar

Nehru nagar

Avantika extension

Earthala

Govindpuram

Others

Q5. How many facilities are you expecting in your apartment ?

Good communication

Security

Fittings

Interior design

Car parking

Community hall room

Generator

Sufficient ventilation

other

Q6. What kind of factors effect you during in apartment purchase decision? Please rate the

factors of each of the following information?

Liker scale

Strongly Agree (5) Agree (4) Neither Agree nor Disagree(3)

Disagree (2) Strongly Disagree (1)

Factors Strongly Agree

Agree Neither Agree nor Disagree

Disagree Strongly Disagree

Location

Quality

Price

Interior design

Size

Q7. What are the dilemmas you face when you are selecting a developer companies ? please

rate the factors of each of the following information?

Liker scale

Strongly Agree (5) Agree (4) Neither Agree nor Disagree (2) Strongly Disagree (1)

Disagree(3)

Factors Strongly Agree

Agree Neither Agree nor Disagree

Disagree Strongly Disagree

Quality

Goodwill

Price

Size

Relative reference

Q8. Do u considered about quality ? If is it then by what source ?please rate the sources of

each of the following information ?

Liker scale

Strongly Agree (5) Agree (4) Neither Agree nor Disagree(3)

Disagree (2) Strongly Disagree (1)

Yes

No

Sources Strongly Agree

Agree Neither Agree nor Disagree

Disagree Strongly Disagree

Self perception

Expert opinion

ISO certified

Advertisement and promotion

Relative reference

Q9. Which brand name apartment would you like to purchase ? Companies have mentioned

below?

Civitech housing india Pvt. Ltd.

SVP group

VVIP addresses

Landcraft developers Pvt. Ltd.

Panchsheel buildtech Pvt. Ltd.

Supertech Livingston crossing republic

Ansal elegance

Wave city

Nirala developers Pvt. Ltd.

other

Q10. What kind of facilities do you want from developer companies ? please rate the facilities

of each of the following information ?

Liker scale

Strongly Agree (5) Agree (4) Neither Agree nor Disagree(3)

Disagree (2) Strongly Disagree (1)

Facilities Strongly Agree

Agree Neither Agree nor Disagree

Disagree Strongly Disagree

Timely handover

Quality maintaining

Installment pay

Bank loan

After sales service

Q11. If you have given two chooses between land and apartment what would you like to

prefer and for what purpose ?

Purchase an apartment

Purchase a land and construct own building

Q12. What are the factors do you fear about purchasing an apartment from real estate

companies ? please rate the factors of each of the following information?

Liker scale

Strongly Agree (5) Agree (4) Neither Agree nor Disagree(3)

Disagree (2) Strongly Disagree (1)

Factors Strongly Agree

Agree Neither Agree nor Disagree

Disagree Strongly Disagree

Timely handover of apartment

Low quality of fittings and raw material

Proper apartment allotment according to the diagram

Breach of

commitment by the

developer company

Utilities approval (water , gas , electricity , city corporation)

Findings and analysis

1. What is your price range for purchasing an apartment ?

Budget: A budgeted amount is the expected amount a customer keeps aside. In

this section, we are interested to know the budgeted amount kept by the

customers for the purpose of buying an apartment constructed by a typical real

estate developer company. In the survey it was found that maximum number of

consumers (50%) budget for an apartment is 40 50 lac . Also, a

substantial number of consumers (30%) has a budget of more than 50 lac,

whereas (20%) of consumers budget is around 30 40 lac for purchase an

apartment. This is directly related with their income level.

Table 1 budget for apartment purchase

Budget in lac frequency percentage %

20 30 lac 0 0%

30 40 lac 6 20%

40 50 lac 15 50%

50 above 9 30%

Total 30 100%

Example of histogram

2. What type of apartment are you interested in ?

Types of apartment: Types of apartment are also an important factor in

consumers preference in terms of an apartment. Because there are several types

of apartments and consumers can purchase any type of apartment based on

their need, income and budget. So it is important to find out that which type

of apartment is more popular among the consumers. It was found that about

(37%) consumers prefer economy apartment, (30% )customer prefer Semi

Luxuries apartment. On the other hand duplex apartment (20%) and luxury

apartment (13%) are more preferable to wealthy

customers.

Table 2 preference of apartment type

Apartment type frequency %

Studio apartment 0 0% Economy apartment 11 37%

Duplex apartment 6 20% Semi luxuries apartment 9 30%

Luxuries apartment 4 13% Total 30 100%

3. How much square feet are you seeking ?

Size of apartment: Size is another very important factor of

consumers preference when it comes to apartment. It is important

to consider because consumers budget is related with the apartment

size. The larger the apartment size the price of apartment is also

high. In terms of Size, majority of the consumers prefer (37%)

prefer 1250 1350 Square feet. Next majority of customers prefer

1350 1550 Sft (30%). Also, there is a strong demand for even

smaller flat (20%) and less demand for larger flat (13%).

4. What type of location are you interested in ?

Preferable Location in ghaziabad city: Location of the apartment is

one of the most important factors of consumers preference in

terms of an apartment. People try to move to those locations

where communication facility is good and security is high. Naturally

price is also related with the good location. So it is important to

find out that which locations are more preferable to the consumer

for their apartment. From the table it can be stated that

indrapuram is a top preference (16%). This is because this area is

one of the most prestigious areas in ghaziabad city. This is followed

by vaishali and vasundhara R/A (14%), rajnagar extension and Gandhi

nagar R/A (10%), Nehru nagar and avantika extension (6.7%).

govindpuram (3.3%). No one interested in earthala (0%) Then

(20%) of the consumers prefer other location from the above-

mentioned area such as Mohan nagar , ambedkar road etc.

Table 3: Preferable Size of Apartment among Consumers Apartment Size (Square feet) Frequency Percentage 900 950 Sft. 0 0% 1050 1250 Sft. 6 20% 1250 1350 Sft. 11 37% 1350 1550 Sft. 9 30% 1550 3000 Sft. 4 13% Total 30 30%

5. How many facilities are you expecting in your apartment ?

Preferable Facilities in an Apartment: Facilities of apartment are also

an important factor of consumers preference in terms of an

apartment. Facilities are actually design and development

related features which makes one apartment project different from

others and one company from other. Thats why it is important to

know that which types of facilities are most preferable to the

apartment purchaser. From the table it can be stated that good

communications (23%) is the most desired facility followed by

fittings (17%) and Security (20%). Then come interior design (10%)

and car parking (10%). Generator and ventilation also are important

(6.7% and 3.3% respectively).

Table 4: Percentage of respondents selecting each Location Location Name Frequency Percentage Indrapuram 5 16%

vaishali 4 14%

vasundhara 4 14% Raj nagar extension 3 10%

Gandhi nagar 3 10% Nehru nagar 2 6.7%

Avantika extension 2 6.7% govindpuram 1 3.3%

earthala 0 0%

other 6 20% Total 30 100%

Table 5: Percentage of respondents selecting each Facility Name of the Facilities Frequency Percentage Good communication 7 23% security 6 20%

Fittings 5 17% Interior design 3 10%

Car parking 3 10% Community hall 2 6.7%

Generator 2 6.7%

ventilation 1 3.3% others 1 3.3%

Total 30 100%

6. What kind of factors effects you during in apartment

purchase decision ?

Factors related to Purchase Decision: Several key factors came up at

the forefront in the test or pilot survey. In the final questionnaire

some factors were given to the customers and were told to rate the

factors in a Likert type preference scale, where score of 5 means

most important. From the table we can see that Location and

Quality of the work are most important (3.6 and 3.4), followed by

price (3.1). Here, one interesting thing came out that price is not

the number 1 factor though most of the customers prefer economy

budget apartment.

Table 6: Preference of different Factors in purchasing apartment Factors Mean score Location 3.6 Quality 3.4 Price 3.1 Interior Design 2.9 Size 2.7

Working note

Calculation of mean from likert scale method

For this example, we'll use a 5-point rating scale question. The weights assigned to each

answer choices are shown in parentheses:

Responsibilities are shared fairly among your team members.

Strongly Disagree (1)

Disagree (2)

Neither Agree nor Disagree (3)

Agree (4)

Strongly Agree (5)

After collecting responses to the survey, the results will look something like this.

Strongly

Disagree Disagree

Neither

Agree nor

Disagree

Agree Strongly

Agree Total

Average

Rating

Responsibilities are

shared fairly among your

team members.

20.45%

9

27.27%

12

20.45%

9

11.36%

5

20.45%

9 44 2.84

The average rating of 2.84 indicates that the average sentiment among respondents is

that responsibilities are not shared fairly among their team members. The average

rating was calculated as follows:

(9*1) + (12*2) + (9*3) + (5*4) + (9*5)

44

125/44 = 2.84

Location :-

(10*5)+(7*4)+(6*3)+(4*2)+(3*1) = 107 = 3.6 mean score

30 30

Quality :-

(9*5)+(6*4)+(5*3)+(5*2)+(5*1) = 99 = 3.4 mean score

30 30

Price :-

(8*5)+(6*4)+(5*3)+(5*2)+(6*1) = 95 = 3.1 mean score

30 30

Interior design :-

(6*5)+(7*4)+(4*3)+(5*2)+(8*1) = 88 = 2.9 mean score

30 30

Size :-

(4*5)+(6*4)+(5*3)+(8*2)+(7*1) = 82 = 2.7 mean score

30 30

7. What are the dilemmas you face when you are selecting a

developer companies ?

Factors in Selecting Developer Company: Selection of a good developer company

is an important factor to a consumer for purchase an apartment. There are so

many developer companies that a consumer may easily get confused about which

company to select. Same as above, several key factors came up in the initial

survey. Then these factors were given to the customers for preference rating.

From the table we see that Quality of the project and companys existing

goodwill are the most important factor followed by price and reference of the

relatives.

Table 7: Factors preferred in selecting developer company

(5 = most important, 1 = least important)

Factor Mean score Quality 3.8

Goodwill 3.7 Price 3.5

Size 3.1 Relatives reference 2.7

8. Do u considered about quality ? If is it then by what source ?

How customers determine about quality: In the previous table, it is seen that most of the

consumers are more concerned about quality rather than price. Now it is important to know how consumers determine or decide on quality or for what factors consumers think some apartment is

of better quality than others. From the table it is seen that maximum consumer decide on their

own perception of quality. Expert opinion also is almost equally important though. Advertisement

and promotion is less important a factor than other factors to form the decision on quality.

Table 8: Factors related to Quality Determination

(5 = most important, 1 = least important)

Factors Mean score Self perceptions 3.5

Expert opinion 3.2 ISO certified 3.1

Advertisement and promotion 2.8

Relative reference 2.5

9. Which brand name apartment would you like to purchase ?

Companies have mentioned below?

Company Brand Selection: Selecting specific Developer Company is an important

factor in the overall apartment purchase. All other preferences come down to

selection of a brand that is trusted to have all those preferred qualities. This

was done through non guided brand recall technique. Customers were asked to

name the brand .

Table 9: Consumer preference about Developer Company Brand

Company name frequency Percentage

Civiltech housing india pvt.ltd

2 6.7%

SVP GROUP 3 10% VVIP addresses 4 14%

Landcraft developers pvt. ltd

2 6.7%

Panchsheel buildtech pvt. ltd

0 0%

Supertech Livingston crossing republic

5 16%

Ansal elegance 4 14%

Wave city 3 10%

Nirala developers pvt. ltd 1 3.3% other 6 20%

10. What kind of facilities do you want from developer

companies ?

Desired Services or Facilities from a particular company (Brand): Facilities from

Developer Company are an important aspect of consumer purchase decision

process. It is important to find out what kind of facilities consumers want from

the Developer Company. In the questionnaire some criteria are given for rating

along the scale ranging from 1 to 5. From the table, it can be

said that timely hand over or completion of the apartment project is the most

important service that customers want (3.8). It is followed by other factors

like quality maintaining across the projects, installment facility, and link to bank

loan to purchase the apartment.

Table 10: Factors important in selecting developer brand

(5 = most important, 1 = least important)

factors Mean score

Timely handover 3.8 Quality maintaining 3.7 Installment payment 3.5

Bank loan 2.8 After sales service 2.7

11. If you have given two chooses between land and

apartment what would you like to prefer and for what

purpose ?

Preference between apartment and land: Many customers have a dilemma

between purchase of an apartment or a land. Some think that purchase of an

apartment from a developer company is

advantageous. Some consumers think that purchase of a land and then construct

own building is better. But it came out so that majority of the customers,

around seventy percent prefer purchase of an apartment to a land. The reasons

mentioned were: purchasing apartment has no construction hassle and also saves

ones time needed to oversee a construction oneself; Increasing, skyrocketing land

price makes it difficult to purchase a land; increased and volatile price of

construction related raw materials is also one reason, that is, once started with

a predetermined budget it is difficult to manage with own investment. On the

contrary 36% consumers prefer purchase a land and construct own building. The

reasons stated were: Control over asset; proud owner of a land and building; it

is a source of income etc.

Table 11: Consumers preference about Land or Apartment Purchase

Land vs apartment frequency Percentage

Purchase an apartment 19 64%

Purchase a land and constructs own

building

11 36%

12. What are the factors do you fear about purchasing an apartment from

real estate companies ?

The risk factors perceived by the customers in purchasing apartment: It means

what the factors are that consumers fear about purchasing apartment from a

real estate company. The result was totally shocking. Almost all respondents

were found to be equally concerned about the following factors:

Table 12: Perception of Risk factors

factors Mean score

Timely handover of apartment 4.1

Low quality of fittings and raw materials 3.5

Proper apartment allotment according to the

diagram

3.4

Breach of commitment by the developer

company

3.3

Utilities approval (water , gas , electricity , city

corporation)

2.9

Policy Implications and Conclusion

This study can be considered as a little contribution to the understanding the

real estate industry, According to a survey conducted by the City Mayors Foundation,

an global think tank on urban affairs, there are 37 Indian cities among the world's 300

fastest growing urban centres . The Indian city of Ghaziabad is the second fastest

growing city in the world. The general parameter used to consider the growth of a city

is the rate of its urbanization

Policy makers can take the factors into consideration while

making related regulatory policies and framework. Government regulators should

form appropriate policy to safeguard the interests of the customers. For

example, government should provide clear easy to understand guideline for the

citizens about how to evaluate the quality of the projects, how to check the

authenticity of the projects and the companies, some cost estimation to

compare the market price etc.

On the other hand, real estate companies and developers can

take these factors into consideration while making their business strategy and

marketing strategy. This study will help them to understand consumers better

by knowing their preferences in different dimension. In many cases consumers

have several negative ideas about the developer company such as late handover,

low quality, allotment problem etc. Thats why it is very important for the

developer company to overcome these problems and make a positive image in the

consumer mind.