DE­MAND FOR HOUS­ING WEAK­ENS

Rea­sons? High va­cancy lev­els and in­ter­est rates

HT Estates - - NEWS - HT Es­tates Cor­re­spon­dent

Slow­ing eco­nomic growth, cou­pled with high prop­erty prices and steep in­ter­est rates re­sulted in weak de­mand for hous­ing dur­ing the sec­ond half of 2013, ac­cord­ing to CBRE’s bi-an­nual India Res­i­den­tial Mar­ket View re­port for the sec­ond half of 2013.

High va­cancy lev­els and ris­ing con­struc­tion costs led to a slow­down in con­struc­tion ac­tiv­ity, caus­ing a de­cline in new launches, and fur­ther de­lay in project com­ple­tion time­lines.

Liq­uid­ity i ssues and an in­creas­ing in­ven­tory caused de­vel­op­ers to shift their fo­cus from new launches to the com­ple­tion of ex­ist­ing projects, although de­lays i n project ex­e­cu­tion con­tin­ued to re­main an over-rid­ing con­cern in most emerg­ing hous­ing mar­kets. De­vel­op­ers re­duced prices across se­lect projects and of­fered dis­counts or mar­ket­ing pro­mo­tions to at­tract buy­ers.

While the pre­mium hous­ing seg­ment saw a steady in­ter­est from high net-worth in­di­vid­u­als (HNIs) and non-res­i­dent In­di­ans (NRIs), end-user de­mand in the high-end and mid-end seg­ments re­mained low. The de­pre­ci­at­ing ru­pee, which tum­bled to a se­ries of record lows dur­ing 2013, re­sulted in an in­crease in NRI en­quiries for prop­erty in India.

Ac­cord­ing t o An­shu­man Magazine, chair­man and man­ag­ing di­rec­tor of CBRE, South Asia Pvt Ltd, “Home­buyer sen­ti­ments re­mained cau­tious and sub­dued due to high price points, with pref­er­ences shift­ing to sec­ondary and emerg­ing mi­cro-mar­kets of lead­ing cities. Hous­ing de­mand in the high­end and mid-end, as well as in the lux­ury seg­ment, is likely to re­main slug­gish across India’s lead­ing cities dur­ing the first half of 2014, due to the sub­dued, pre- elec­tion macro- eco­nomic en­vi­ron­ment.”

PRADEEP GAUR/ MINT

The for­mer chief min­is­ter of Delhi has signed a 11-month rental agree­ment for a 2,000 sq ft three bed­room flat on the fifth floor of Sil­ver Arch apart­ments

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