Fes­tive sea­son does not bring much cheer

With the realty mar­ket in re­cov­ery mode, sales ve­loc­ity re­mained unin­spir­ing dur­ing Navra­tra and Di­wali

HT Estates - - FRONT PAGE - Van­dana Ram­nani

Li ke al­ways, dur­ing D i w a l i t h i s ye a r, sev­eral de­vel­op­ers an­nounced f es­tive of­fers to lure home­buy­ers, of­fer­ing pos­ses­sion of units and in­no­va­tive fi­nan­cial schemes, among other things. Though there was in­ter­est among buy­ers, not many of them bought res­i­den­tial prop­er­ties. They pre­ferred to wait to reap the ben­e­fits of a likely mar­ket re­cov­ery be­cause of the new gov­ern­ment at the Cen­tre and the tax sops an­nounced in the Bud­get. Sur­pris­ingly, it was the sec­ondary mar­ket that did fairly well this sea­son and that was pri­mar­ily be­cause ready- to­move-in prod­ucts were avail­able “off the shelf ” at a “com­fort­able” price for buy­ers. “Sales ve­loc­ity dur­ing this fes­tive sea­son re­mained unin­spir­ing de­spite the var­i­ous at­trac­tive pricing schemes and dis­counts that de­vel­op­ers have been of­fer­ing to at­tract buy­ers. How­ever, the cur­rent sce­nario is in no way in­dica­tive of what lies ahead for the real es­tate mar­ket, for which the out­look re­mains very pos­i­tive. To my reck­on­ing, we are cur­rently at the cusp of growth, and the tan­gi­ble man­i­fes­ta­tions of the cur­rent mar­ket re­cov­ery will be­come vis­i­ble over the next 12 months. The old dic­tum ‘what cooks slowly, cooks well’ is very per­ti­nent in the present sce­nario,” says Anuj Puri, chair­man and coun­try head, JLL In­dia.

The ben­e­fits of a re­cov­er­ing mar­ket could not be har­nessed dur­ing the fes­tive sea­son. The events that catal­ysed the re­cov­ery – namely the new gov­ern­ment at the cen­tre, its pro- business poli­cies, t he en­cour­ag­ing Union Bud­get and its pro­vi­sions favour­ing real es­tate, are likely to take more time to im­pact the mar­ket. Like­wise, the RBI held on to cur­rent in­ter­est rates as safe­guard against fur­ther in­fla­tion­ary trends. It will take sev­eral more months for t he mar­ket t o g ai n c on­vinc­ing mo­men­tum again, so the fes­tive sea­son did not bring the kind of mo­men­tum that was hoped for, Puri adds.

Vi­neet Relia, managing director, Sare Homes, says, “Post 2011, of­fers dur­ing fes­tive sea­son don’t work. Cus­tomers buy houses when they get a good deal. In­ter­est­ingly, we get more en­quiries dur­ing shradh (a pe­riod of mourn­ing when trans­ac­tions are con­sid­ered in­aus­pi­cious). Many cus­tomers leave be­hind post dated che­ques with a Navra­tra date. Free­bies do not help shore up sales. A free trip to a for­eign coun­try on book­ing is no longer a de­ci­sion maker or a trig­ger to close a deal. Only an af­ford­able price and a good lo­ca­tion is.”

There has been no sig­nif­i­cant im­prove­ment in sales this sea­son. In­ter­est­ingly, the re­sale mar­ket is tak­ing off in a big way and has seen an im­prove­ment of about 10%. “Over­all ac­tiv­ity in this seg­ment has in­creased as fence sit­ters are tak­ing fast de­ci­sions. This be­ing a ready- to- move prod­uct, there is more trac­tion in this seg­ment this sea­son,” says Shveta Jain, executive director, res­i­den­tial, Cush­man & Wake­field In­dia.

There have also not been too many new launches. With ref­er­ence to the high lev­els of un­sold in­ven­tory, launches have de­creased con­sis­tently since the first quar­ter of 2013, with the ex­cep­tion of the first quar­ter this year, in which launches in­creased.


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