The curtains are down on the year 2008. The year, which began on a good note for real estate sector in Punjab brought anxiety for builders in the last quarter as demand fell sharply.
Due to the global economic meltdown, demand slowdown coupled with liquidity crisis, mega projects coming up in the state moved at snail pace.
Evaluating the performance of real estate sector in the state, the president of Punjab Colonisers and Builders Association, Kulwant Singh said 2008 was worst for the sector. ?The demand for housing fell sharply and due to the liquidity crunch, most of the builders had harrowing time in executing their plans. Despite the rising construction and labour costs, which were discouraging the builders to reduce the property costs, price came down. It is expected that inflated land prices will come down further to some extent. However, with banks lowering interest rates on home loans, the situation may become conducive for the industry?.
However, most of the major real estate players including DLF, Unitech, Parsvnath and Omaxe and Ansal who have various residential and commercial projects in the state maintained that the market of Punjab was favourable to them due to high consumer spending of people.
Talking to FE, D S Sachdev, Ansal API said, ?Punjab has a good appetite and carries an immense potential for the real estate sector. The year 2008 was not excellent for this sector and the last quarter of the year was terrible as there was no demand at all. But by mid 2009, things will brighten up for this sector.?
?However, Punjab has always been a favourable market for us unlike other states of the country. We witnessed demand for all three categories mid-segment, upper and premium segment. We registered 70% bookings for commercial projects and 70% demand for built-up houses. The banks should lend support in increasing the consumer demand by lowering their rate of interest? he added.
Supporting his comments, Tarun Kumar Gupta, vice president of Omaxe said Punjab has been consuming more than other states and despite, various challenges posed by the economic meltdown, the state market proved fruitful. He also claimed there was no delay in carrying out the plans and hoped to expand further in Punjab.
Interestingly, despite the slump in real estate sector, the revenue under stamp duty and registration collection of state government swelled by 23.7% from April to November in 2008 as compared to the same period last year.
Talking to FE, financial commissioner revenue (FCR) Romila Dubey said, ?Total collection under stamp duty and registration stood at Rs 1,275.85 crore from April to November against Rs 1,057.29 crore registered during the same period last year.
However, total revenue collection during the last financial year stood at Rs 1,619.29 crore. Though, the response was not so encouraging in December but still we hope to surpass the target of last fiscal?.
