 "Home sales up 15% during festive season")
Is real estate sector witnessing signs of revival? Experts vouch that at least in major markets such as Mumbai, Delhi-NCR (National Capital Region) and Chennai, they are witnessing buyer-interest. For instance, Godrej Properties sold about 300 apartments worth Rs 700 crore within a week of launching its project, The Trees, in Mumbai.
Estimates show sales of housing units across the country increased 10-15 per cent during October to November this year compared to the corresponding period previous year. “We are seeing improvement in demand. Prices have come down 15-20 per cent in the past one-and-a-half year and there is no further scope for reduction. Also, we saw sales increasing 15 per cent during festival season, especially Diwali,” said Geetamber Anand, president, Credai and chairman of ATS.
Honey Katiyal, founder and chief executive officer, Investors Clinic, a real estate consultancy, echoed similar views and said there has been slight uptick in sales in the festive season. “We have already started seeing signs of revival. The real estate market is all about sentiments and they have turned positive. Even the activity on the ground has increased slightly,” he said.
An affordable project launched by Amrapali last week in the National Capital Region for serving and retired government employees got huge response from users. The company expects to book at least 1,000 units in the coming 10 days. It has a total of 5,000 units. Similarly, another developer Vipul Group has recently received funding of about Rs 450 crore for one of its projects in Gurgaon from a non-banking financial company. In May this year, Godrej had sold 200 apartments in about three weeks after the launch of Godrej Icon, a residential project in Gurgaon.
“Right mix of location and pricing plays a huge role in selling a project. Apart from this, some projects are getting takers because of their big brand,” said a consultant tracking the sector.
Pankaj Kapoor, managing director, Liases Foras, said the market was bound to improve as interest rates have come down. Along with this, no substantial increase in prices coupled with various discounts are forcing buyers to look for a good deal. “Affordability has improved in most markets, including the NCR and Mumbai,” Kapoor said.
The realty market has been hit by an economic slowdown. Coupled with the financial constraints of developers, sales have been low in the past two years. The sector has also been marred with high inventory and developers have been focusing on clearing the stock rather than launching new projects.
Pirojsha Godrej, managing director, Godrej Properties, in an interview to Business Standard last month, had said, for the right developer and right project, demand continues to be good.
“For more full-fledged recovery, confidence needs to improve. Things are on an upswing. Though, I don’t think pricing is the most important thing in recovery. It is demand volumes, which is most important. People are getting confident that prices are not going to crash. I don’t think any major crash is possible in the medium term,” Godrej said.
