Real estate companies are rushing in with discounts and freebies ahead of Diwali, a time which accounts for high volume of home sales in the country. Pan-India residential projects offering deals have risen 45 to 50% in the run-up to the festival season, and may double further by Diwali and year-end as realtors attempt to clear their piled up inventory.
Book and save minimum of Rs 2-12 lakh, no brokerage fees, free 100 gm gold coins with purchase of an apartment, free registration and stamp duty worth lakhs of rupees and free car--these are among the offers being promoted by developers to tap buyers in a slow market.
As many as 400 projects across the country including cities like Delhi, Mumbai, Bangalore, Kolkata and Chennai have some deal or the other to offer, according to property website Magicbricks. The number was just 275 not too long ago. The projects hawking deals may go up to 800 if small developers join the party as well by Diwali.
There’s action around the deals, and that does not mean brisk sales alone. For instance, Investors Clinic, a real estate platform, is organizing a Navratra property festival across six locations in Delhi NCR on October 5 and 6. Developers including Ajnara, Amrapali, Mahagun, Parsvanath, Spire, Supertech, Wave and Jaypee are participating. There are many more property fairs across the country.
This festive season is a ‘do or die’ situation for developers battling low sales and high inventory and makes up for about one third of total sales for the sector, according to experts.
Ashutosh Limaye, head (research & real estate intelligence service), JLL India says, ”This (festive seaon) is the last chance for developers….otherwise price cuts are inevitable. We will have to wait and see how much of the discounts/offers get converted into sales but this will definitely tell us the flavour of the market.”
Sudhir Pai, Business Head, Magicbricks adds that such offers from developers have gone up substantially in the last couple of quarters.
Till now, the sector has seen high inventory levels with low sales and even less new launches this year. Mumbai has an inventory of close to 48 months, Delhi of 23 months and Bangalore of 25 months. This is above the comfortable level of 14-15 months, according to a report by Jones Lang Lasalle (JLL).
Brotin Banerjee, managing director, Tata Housing, says, “Festive season is an opportune time for developers to offer attractive schemes to the buyers which will help accelerate the sales momentum for residential projects.”
But, there are those who differ. ”These offers are not enough to attract the jaded buyers. They won’t respond favourably to discounts. And if negative sentiments continue, prices might come down,” Sanjay Sharma, managing director of Qubrex, a consultancy, said.
