The real estate industry is shifting gears from a sellers market to buyers market. After four-five years of boom phase, real estate has begun to face the heat of the slowdown just like most other sectors of the economy. In the boom period Chandigarh properties were selling as fast as developers can make them! Both commercial and residential properties were in demand. But now prices have fallen as a rising number of sellers come under pressure to dispose of real estate assets in exchange for cash. A number of residential buyers have followed the wait-and-watch policy and are waiting a price correction before buying a property as the global economy faces turmoil and an improbable future. This has affected the demand of the real estate space, which is already at a very low level and further, this could also affect development plans of builders. “I’ll rather wait for another one year for the prices to go down further as I don’t want to take risk that today I’m investing in a property worth Rs.24, 00,000/- and after few days it dips to 20 Lakhs, so I just want to avoid the risk and want to wait until the market gloom in its proper shape”, says Chanpreet Singh Chawla, CTO of an IT Co., Mohali.
Although developers are cautious about admitting to price correction, the sector is witness to 15-20 per cent cuts already and there is potential for more. “Affordable houses should be constructed for the end users who want to go in for less expensive homes, as the rates on home loans have also been declined by the banks”, says Amit Sharma, a resident of Mohali. “In Chandigarh prices vary between Rs 60,000-75,000 per sq yard, even the smallest unit of 125 sq yard is not available in the specified home loan range and same scenario prevails in Panchkula and Mohali”, says Gurpreet Singh, Sales Manager, Online Real Estate Pvt. Ltd.
“Government should pour in some more money in the real estate sector for generating the demand and to ensure the smooth supply in the realty market”, suggest an official from the Estate Office, U.T. Chandigarh.
“Property consultants play influential role in converting any transaction. Developers assign their projects to authorized consultants and they quote prices according to their convenience, so there should be a proper channel and parameters to stop the exploitation of the genuine buyers”, proposed Ram Sinha, a resident of Sector- 48. Also developers should provide some facilities like, power back-up, parking, security, lift services; club membership etc for free of cost.
Buyer is the lead player in the current market scenario and is looking for change in the form of increase in transparency in the real estate market, simplifying land acquisition procedures, reducing stamp duties, devising a single-window clearance system and reframing development control rules to meet the present requirements and supporting infrastructure. The present situation call for some consolidation within the sector and perhaps the need to create an innovative scenario in the real estate sector that could support end users and as well as financially distressed developers to tide over.
By Harsimran K. Kalra