Northern realty goes down under

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: The desire to splurge, backed by a passion for extravagance, which was drawing the happy-go-lucky people in north India towards buying luxurious apartments seems to have fizzled out with the economic slowdown as the investors pull their hands out of the real estate projects. Even players like Parsvnath, Uppal group, Unitech, Omaxe etc coming up with projects in Punjab, Haryana and Chandigarh are feeling the heat of the recession, with some of them planning to move over to affordable housing from luxurious one.

One of the major contributing factors for fall in demand is the exorbitantly priced and opulent apartments being offered by these developers. Commenting on the present scenario, PK Jain, Advisor, Parsvnath Developers says, “Due to the downward trend in demand, buyers have postponed their buying plans for 5-6 months and are waiting for the prices to come down. We cannot reduce the prices of our apartments as the as the input costs are still high.”

Slowdown effect

Prideasia — the luxury township project of Parsvnath coming up at the Rajiv Gandhi Chandigarh Technology Park is also getting affected due to the slowdown as only 160 units out of the 1,314 proposed have been sold so far. And only six out of 34 villas have been sold. Parsvnath has priced its villas at Rs 6 crore and penthouses at Rs 4 crore. The one to five-bedroom apartments are priced between Rs 52 lakh to Rs 3.8 crore. Buyers are finding it hard to afford these highly priced apartments and villas.

Few companies are facing about 20% slump in demand but still are firm about completing their project on time. Uppal’s Marble Arch coming up in Chandigarh offers apartments ranging between Rs 1.5 crore to Rs 2 crore. A senior official shared, “Our project is near completion but now the real investor is stretching his hands to buy luxurious apartments due to liquidity crunch. We have registered 20% decline in demand of our apartments but 108 flats out of 168 have been sold. Now only the actual buyers are coming forward to crack the deals and we don’t intend to reduce the prices in the future.”

Developers undeterred