Buyers are drawn more to new projects
The resale market in cities like Delhi, Mumbai, Pune, Bengaluru and Chennai may continue to grow, but homebuyers are looking at investing in brand new apartments with the latest features and facilities
Hi storically, cities like Mumbai, Pune, Bengaluru and Chennai have always enjoyed a strong resale residential market. Buyers were primarily focused on price and flat size, and the resale market tended to offer good deals on both these counts.
This scenario has now changed visibly, and a new t rend of ‘ home obsolescence’ has become a firmly entrenched market dynamic. Kishor Pate, CMD, Amit Enterprises Housing Ltd, says, “Fundamentally, the process that renders homes obsolete can be compared to that of electronics and home appliances. Because of rapid technological advancements and high competitiveness among suppliers of such goods, the newer range of products have an attractive range of added features that makes the older models redundant and undesirable.”
Commercial spaces in ageing office complexes are not as interesting to occupiers because they lack the modern features of newer office projects. Likewise, residential projects which were developed as little as five years ago lack the attractive value-adds which are available in the latest projects. Construction technology, design trends (both at the project and individual unit level), internal fittings such as plumbing, sanitaryware and electrical appliances have all taken a quantum leap forward in terms of functionality, userfriendliness, visual appeal and cost effectiveness.
Pate adds, “In many cases, older projects often do not have adequate parking, common amenities and open spaces, as they were developed before the latest regulations concerning these were enforced. The combined effect of these has resulted in the rapidly reducing popularity of resale homes among home buyers. While it is true that some resale properties offer more central locations, it is equally true that these locations tend to be beset by massive infrastructure deadlocks today. Also, older projects will lose in investment value at a rate proportionate to the age of the project.”
In contrast, buyers who chose to opt for a brand new apartment have several advantages, says a real estate consultant. In the first place, they can opt to invest in an apartment at significant discounts while the project is still under construction. Secondly, they benefit from the fact that such projects have fresher designs, are fully compliant with the latest development regulations and have features such as rainwater harvesting and reserved parking. The units themselves have the latest electrical fittings and have superior layouts.
A l s o, t h e i nve s t m e n t value of new flats remains on an upward trajectory for several years, says a broker active in the Noida market. While the resale market will continue to draw attention, many homebuyers in cities like Delhi, Mumbai and Pune will not settle for anything less than a brand-new flat with the latest features and fittings.