Mumbai property sales: Some experts blame high prices, others say marriage season has changed prospective buyers’ priorities
Contrary to a boom expected in the real estate market, the festive season failed to revive property registrations in the city. Non-affordability continues to drive away home buyers, feel industry experts. According to the data from Director General of Registrations, property sales registrations in October fell 8.5 per cent from September.
Although festivals of Diwali, Eid and Navratri, typically considered auspicious for home buyers, fell in October, house registrations dropped to 4,115 from 4,500 in September.
August figures remained stagnant over September as buyers delayed purchase decisions in the hope of new offers and project launches around the festive season.
Paras Gundecha, President of Maharashtra Chambers of Housing Industry (MCHI) said, “Festive times, which are considered auspicious for buying property, have failed to generate interest among buyers. Affordability is a big factor. Increasing land costs, hardening interest rates are also making it difficult for buyers to invest in real estate.”
Interestingly, the ongoing marriage season seems have played its part in the slowdown of house registrations. Jayesh Vyas, President of The Association of Real Estate Agents (AREA), said, “Scores of marriages during October led to diminishing interest among home buyers. People prefer to make decisions on investing in property at leisure. With the marriage season on, people are deferring their decision.”
Data also indicates that it is not only monthly but also yearly sales registrations that have dropped. The decline was over 11 per cent in October as compared to the same period last year.
Gulam Zia, executive director (research & advisory) from Knight Frank India, said, “Transactions have shrunk not only due rise in prices but also due to short supply. A large chunk of properties is under construction, leading to a gap in demand and supply. Although there have been registrations as far as new launches are concerned, those buyers have not officially bought the houses. They are only showing willingness by registering their names with real estate companies. These figures will not be counted in registrations unless the buyers pay.”
Analysts, however, hope that with an increase in supply, property prices are expected to become stable.
Also, while there is no room for price correction, builders will begin to attract home buyers with goodies and marketing gimmicks.