De­vel­op­ers tar­get­ing high-end prop­erty buy­ers... but will it work?

There’s a gap be­tween buy­ers’ ex­pec­ta­tions and what the de­vel­op­ers plan to of­fer them this year, says a re­port

HT Estates - - Front Page - HT Es­tates Cor­re­spon­dent

The fes­tive sea­son starts with Ganesh Chaturthi and is fol­lowed by Navra­tra, Durga Puja, Dussehra and reaches its peak around the fes­ti­val of lights – Di­wali. The prop­erty mar­ket in In­dia tra­di­tion­ally wit­nesses higher prop­erty transactions dur­ing this sea­son.

Buy­ers’ ex­pec­ta­tions

The over­all mood among home­buy­ers is up­beat, with a ma­jor­ity 64% keen to fi­nalise a prop­erty deal dur­ing the next 100 days. As many as 61% home­buy­ers are look­ing for­ward to plenty of new prop­erty launches dur­ing the fes­tive sea­son. There seem to be more peo­ple want­ing to fi­nalise deals this year as com­pared to last year, when just 52% had ex­pressed their will­ing­ness to buy prop­erty. This is a pos­i­tive change, says a re­port by, ti­tled Fes­tive Re­al­ity 2012 – Home buy­ers’ ex­pec­ta­tions from the fes­tive sea­son.

When it comes to the bud­get, 71% of home buy­ers are on the look­out for houses in the af­ford­able cat­e­gory, with a bud­get of un­der R40 lakh, whereas 19% are look­ing for hous­ing in the mid-seg­ment ( R40 lakh to R75 lakh). The re­main­ing 10% are look­ing for homes in the high-end and lux­ury cat­e­gory within the budge of R75 lakh to R1.25 crore, re­spec­tively.

Home­buy­ers are look­ing for­ward to schemes and free­bies from de­vel­op­ers dur­ing the fes­tive sea­son. As many as 62% of the re­spon­dents (al­most the same per­cent­age want­ing to buy prop­erty) are ex­pect­ing de­vel­op­ers to of­fer free­bies and dis­counts equiv­a­lent to or more than 5% of the home value whereas an­other 20% are look­ing for a dis­count in the range of 2% to 5%. Ac­cord­ing to them, dis­counts help them arrive at a fi­nal de­ci­sion. As many as 39% buy­ers are look­ing for­ward to a prop­erty pur­chase in the me­trop­o­lis area while 36% are okay with the sub­urbs. Only 18% said that they may con­sider tier-two cities for a house.

Launches ga­lore

De­vel­op­ers are tak­ing a more con­scious ap­proach to this fes­tive sea­son. As many as 36% of them are look­ing for­ward to less than five launches na­tion­ally dur­ing next 100 days. An­other 29% are con­sid­er­ing five to 10 new launches to cap­i­talise on the fes­tive sea­son. Al­most 45% of the de­vel­op­ers are launch­ing projects in the af­ford­able hous­ing seg­ment while an­other 32% will be in­tro­duc­ing new projects in the mid­seg­ment. The re­main­ing 23% launches are likely to be in the high-end and lux­ury seg­ments. While most of the de­vel­op­ers have made up their minds to of­fer dis­counts and free­bies to at­tract buy­ers, the quan­tum of dis­count varies from de­vel­oper to de­vel­oper. Only a fifth of the de­vel­op­ers are con­sid­er­ing 5% or more dis­count. As many as 29% de­vel­op­ers are will­ing to of­fer dis­counts in the range of two to 5% whereas a ma­jor­ity of 32% are plan­ning dis­counts in the range of 0 to 2%. The bal­ance 18% have de­cided not to of­fer any dis­counts. These are pri­mar­ily de­vel­op­ers who are ac­tive in the af­ford­able hous­ing seg­ment.

What are the trends like?

While peo­ple seem op­ti­mistic, one is not likely to see a mean­ing­ful jump in transactions on ground. Home­buy­ers seem up­beat com­pared to last year but their sprits are fu­elled by high ex­pec­ta­tions from de­vel­op­ers. Cur­rently there seems to be a gap be­tween buy­ers’ ex­pec­ta­tions and cor­re­spond­ing com­mit­ment from de­vel­op­ers. This may play spoil­sport. While buy­ers are ex­pect­ing new launches in the un­der R40 lakh cat­e­gory and at a dis­count of around or more than 5%, the sup­ply in this range is lim­ited and there are fewer dis­counts on of­fer. While de­vel­op­ers are will­ing to of­fer higher dis­counts in the high-end cat­e­gory, the de­mand in this cat­e­gory is low. All this may lead to a rise in the num­ber of en­quiries, field vis­its but may not wit­ness con­ver­sions.


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