It’s going to be another dull Diwali for real estate players, the third in a row. Launches of new properties, which have been trending down for about a year now — the drop in H1 of 2017 was 40% to 62,738 units —could well drop further at a time when the economy is slowing and consumer confidence is low. While Sandeep Runwal, director, Runwal Group, is hopeful the pace of project launches will pick up closer to the festival, Ambar Maheswari, CEO, Indiabulls AIF, is doubtful of it. Maheshwari believes launches will come off in line with the trend in the past several quarters. “Developers will work to offload units in ongoing projects rather than launch new ones,” he said.
That does not seem unlikely given unsold inventory remains high — sales volumes are down 12% since December last year. That means builders will look to providing buyers with ready-to- move-in apartments, which typically fetch premium pricing. In any case, with RERA regulations now in force across several states, fresh launches, which earlier fetched developers’ cash up front, are no longer a possibility.
That the festive season is setting in earlier than usual this year doesn’t make it easier. Several states are yet to operationalise RERA and this has delayed registrations of projects. Large markets such as Bengaluru and Haryana are expected to conclude the process only by end-September, Abhishek Anand, who tracks realty at JM Financial, points out. Read More…
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