Realty developers are hopeful of clearing a large portion of their inventory pile-up during this festive season by luring in buyers with freebies and discounts, even as they sit tight on declared prices.
“Higher interest and the overall slowdown have led to a significant build-up of unsold units with developers in most of the major realty markets over the past few quarters, adversely affecting cash flow and impacting new project launches,” KPMG India partner Neeraj Bansal told PTI.
Further, RBI’s stringent directives like banning the 80:20 scheme is expected to make things more difficult for developers, he said.
The September-December period witnesses maximum launches and publicity of real estate projects. However, industry watchers are not expecting any price correction during the period.
“We don’t expect any price correction now. Most projects have maintained the price levels or in some cases gone up marginally. But since they have already been factored in the slowdown, they will cautiously plan their sales,” PwC India associate director Bhairav Dalal said.
Developers are likely to attract buyers through several discount schemes/gifts with most common being gold coins, cash-back on monthly rentals, customisation, free parking and club facility, zero brokerage and upfront cash discounts, among others.
According to realty portal Magicbricks, developers in metros like Mumbai, Delhi-NCR, Bangalore, Kolkata, Pune, Chennai and Hyderabad have already announced various freebies.
“Offering such innovative schemes is most likely to result in higher enquiries and footfalls, which coupled with festive offerings, may help generate decent sales,” Bansal said.
Demand from primary buyers
Despite concerns over slowdown and high interest regime, still there will be demand from primary buyers, Dalal said.
“There is indeed a slowdown but we believe that sales will happen during this festive season. We will see some offers and discounts, but that may not be major,” he said.
For instance in Mumbai region, which has been witnessing a major drop in sales for quite some time, developers like Lodha, Mantri Realty and Romell Group have already announced various discounts.
While Lodha has offered Rs 2 lakh discount on spot booking for its ‘Lodha Elite’ project in Dombivli, Mantri Realty is offering 100 gm gold on bookings till September 18 for its upcoming Serene project at Goregaon.
Speaking about buyer sentiment, Confederation of Real Estate Developers Association Chairman Lalit Kumar Jain said: “This is the best time when buyers will look at buying homes. Despite the slowdown, there will be demand as people are worried about interest rates still going up which will result in property prices escalating. So they believe this is the right time to cash in.”