The perception that real estate sales pick up during the festive season, considered auspicious for buying a new house is a myth, says a JLL India report. According to the report, the trend has changed now and the seasonal impact on housing demand is a thing of the past.
The real estate services firm said the hypothesis that residential property sales pick up markedly during the festive season was valid in the pre-2010 period, but it does not hold water today.
A look at the data by JLL for demand for residential real estate during the past five years shows that the absorption is largely the same in both halves of calendar years. A weighted average of the past five years shows that the first quarter attracted the highest number of deals at 27 per cent, while the fourth quarter (festive season) attracted 25 per cent, which is at par with the average.
The reasons behind the change in trends given by the JLL India are fall in the average age of home buyers from the mid-50s to the mid-20s. The younger generation prefers to take informed decisions and focuses on better bargaining opportunities rather than auspicious days to purchase property.
The service industry is growing rapidly, and now contributes over 55 per cent of India’s GDP. A larger part of this industry announces salary hikes and bonuses in the second quarter. The manufacturing and trading industry, on the other hand, announces bonuses during Diwali – which falls in the fourth quarter. Many people belonging to the upper-middle and high-income groups plan their investments during the first quarter, for effective tax management purposes.