 "Slowdown hits Pune real estate; unsold inventory reaches 2.8 lakhs")
Despite the dip in the in sales with increased unsold stocks developers are still optimistic about better sales in future and not ready for any significant price correction. Part of the reason why prices continue to be anchored down is the increase in the total supply of projects and number of homes in the market.
"While our findings indicate that the market is facing stress on various counts, this is the right time for the buyer to invest as the prices are flat currently. While the market is being cautious and waiting for the prices to drop further which is the key consideration in any purchase, it is important to understand that additional controls for the sector will lead to increased costs for the developers and this will eventually be passed on to the customers", said Sanjay Bajaj, managing director, JLL - Pune.
Shantilal Kataria, president of CREDAI (Pune Metro) said, "Large number of unsold inventories does not mean there is a reason to panic for developers. The high number of unsold inventories does not mean that ready-made projects are going unsold. There will be some projects and locations that will not find favour amongst home buyers and these projects will find it extremely difficult to achieve financial closure. There is a potential for some projects being grounded till the market sees a turn around."
According to the report, the gross stock has significantly risen by 14.36% in the past 12 months with a net addition of 35,324 homes across 306 additional projects, the unsold stock (inventory with developers for sale) in the same period has shown a steep jump of 36.85% from 66,350 homes a year ago up to a record 90,799 homes at present. The unsold inventory is valued at Rs. 48,526 crore.
"Developers are confident that the market can easily absorb these inventories as it has several sectors like IT, education and manufacturing, which can fuel growth in the real estate sector. For an industry that had no barriers to entry and where core competence required was "managing the process", these challenging & competitive times lead to the emergence of a better product, more customer centricity and greater focus on delivery track records. Hopefully, we will also see the exit of the fly by night operators who entered the industry to make a quick buck," said Rohit Gera, managing director, Gera Developments.