many markets. In order to offload inventory, developers began offering discounts and freebies. But even that was beyond affordable limits of buyers. Deliveries were delayed, while low demand led to cancellation of new launches. Demand for ready-to-move in spaces and resale flats shot up as buyers were reluctant to risk their money in under-construction projects The same situation of 2013 is likely to continue in most of the period of 2014.
According to a report by Colliers International, a real estate services firm, “The end users will continue to be cautious. Current oversupply will get mitigated in coming quarters as very limited new projects are being launched. Capital values across most micro markets in almost all the major cities will remain stable even though the transaction volume will remain a constraint.”
“Overall, residential markets are expected to witness stable capital values except for those projects which are over-leveraged and are unable to attract sales,” says Sanjay Dutt, Executive MD, South Asia, Cushman and Wakefield, a real estate consultancy. “Due to on-going infrastructure developments such as metro rail, mono rail and roads in Mumbai, NCR, Chennai, Bangalore etc, select locations here may witness healthy business activity,” adds Durtt.
According to Puri, redevelopment would be a growth driver in many metros and newer verticals such as rental housing, affordable housing and senior living would show increased activity.
Developers expect the government to take a supportive approach towards the sector. “The government should plan to reduce the housing shortage and encourage rental housing besides enacting the proposed bills,” says Sunil Mantri, president, National Real Estate Development Council (Naredco). “We expect the government to implement single-window and on-line approval system besides support in dealing with acute skill shortage,” adds Mantri.
“The year 2013 has been the worst in terms of growth, sales and governance (approval process). However, the first three weeks in December have shown better sales than the previous month. This is an indication of the realisation that costs have gone very high thereby there is a very little possibility to reduce sale price,” says Lalit Kumar Jain, chairman, Confederation of Real Estate Developers’ Associations