Despite the recent rate cut of 50 bps by the Reserve Bank of India (RBI) and great offers made by developers during the festive season, the investment in the property has remained lukewarm in and around the NCR region due to lack of confidence in state of economy, delay in project execution, lack of fresh employment generation and overall slowdown, reveals ASSOCHAM's recent study.
"The sentiment in the housing market is really at a low key. The prices have almost crashed, but they are still unaffordable. Be it Rohini, Dwarka, South Delhi, Noida or Gurgaon, the prices of property are down by 25-30 percent as compared to the last two years," said D S Rawat, Secretary General ASSOCHAM while releasing the survey.
ASSOCHAM conducted a random survey of nearly 125 real estate developers in Delhi-NCR. The survey reveals that demand for buying property have decreased by over 30 percent over the last year.
As per the ASSOCHAM paper, inordinate delays in getting necessary approvals from multiple regulations and authorities result in cost and times overruns. The resale or secondary market is also dull this festival season as there is very little resale going especially in the NCR and surrounding areas, adds the survey.
According to survey, the residential market has witnessed a steep decline by 25-30 percent in new launches as well as demand resulting in a significant shrinkage.
According to the majority of real estate developers in NCR regions said, about 62 percent of the unsold real estate in NCR is in areas which are currently uninhabitable. The problem has been confounded by delays in regulatory clearances and litigations, points out the survey.
Modular kitchen, LED televisions and air conditioners are among the most common freebies on offer this Diwali. Some developers offered hefty discounts to the basic sale price for early investors. Many others warned of sharp revision in property rates post Diwali. However, the lure of freebies failed to charm home buyers, the survey noted.
Majority of the developers have complained that inordinate delays in getting necessary approvals from multiple regulations and authorities resulted in cost and time overruns.
Festive season considered to be auspicious for home buying and offering bargains, contributes over 30 percent of annual realty sales. But with the prevailing depressed market sentiment, the sector has been witnessing muted sales since the festive season of 2015, recording 30-35 percent lower sales compared to the healthy period of 2010-11.
