The residential segment of the real estate continues to be the central theme irrespective of the real estate market situation. With the increasing demand for residential properties in the country, this is not unexpected matter. But, in a price-sensitive country like India, where the huge demand for residential properties is from the economically weaker section (EWS) and middle income segment, hence demand does not meets absorption. The price sensitivity aspect is further highlighted by the salaried class segments who are highly depend on home loans.
It is a known fact that in 2013 Indian Real Estate Market didn’t do well as expected, as most of the sub markets in the prime cities of the country saw sluggishness and some markets driven by revival in employment and right priced residential properties saw healthy demand and growth. And, one among such cities is Pune, which saw robust demand in mid-priced residential properties in 2013and in the Q1of 2014.The downcast market in most of the cities was due to many reasons that include inflation, decrease in consumer confidence, and hike in interest rate, which led to a sheer increase in EMIs that home loan borrowers had to stand. In many cities, property prices increased as the developers were stricken by debt due to the increase in construction costs.
On the other hand, the global and domestic economic crisis discouraged most of the salaried people in the country to change their jobs for more well-paid jobs. All this led for a downcast in the market in many major cities like Mumbai, Delhi, and Bangalore where inventories piled up and property prices increased.
Nonetheless, the residential segment is blamed for the good or bad in the real estate sector, but it cannot be evaded that the residential real estate backed the sector in 2013. Many project launches were put on hold due to the increase in construction costs and negotiated sales. The demand in the residential segment was mostly from the mid-income and budget segment people that stood as the need of the hour, where more homes were sold and frequently based on the offers and discounts. Whereas, the demand for luxury homes was stagnant besides premium and super-luxury properties saw a sluggish demand.
However, the offers and discounts offered by the developers did not attract property buyers as it was anticipated.
In the first quarter of 2014, the market sentiment will be wary across the country and cities that offered affordable properties and ROI will continue rise. The percentage of sales over inventory in cities where properties were overpriced will remain more, less, or equally balanced and cities like Pune and Chennai are likely to see price rises with concurrent infrastructure development.
Furthermore, increase in property prices is expected as many projects are in completion stage and demand for ready-to-move-in residential properties in top cities is rising. A robust appreciation in capital values in a short period is expected from affordable housing segments and the interim budget has encouraged builders and developers by introducing requisites for this segment that will boost the activity in 2014.
On the other hand, the global and domestic economic crisis discouraged most of the salaried people in the country to change their jobs for more well-paid jobs. All this led for a downcast in the market in many major cities like Mumbai, Delhi, and Bangalore where inventories piled up and property prices increased.
Nonetheless, the residential segment is blamed for the good or bad in the real estate sector, but it cannot be evaded that the residential real estate backed the sector in 2013. Many project launches were put on hold due to the increase in construction costs and negotiated sales. The demand in the residential segment was mostly from the mid-income and budget segment people that stood as the need of the hour, where more homes were sold and frequently based on the offers and discounts. Whereas, the demand for luxury homes was stagnant besides premium and super-luxury properties saw a sluggish demand.
However, the offers and discounts offered by the developers did not attract property buyers as it was anticipated.
In the first quarter of 2014, the market sentiment will be wary across the country and cities that offered affordable properties and ROI will continue rise. The percentage of sales over inventory in cities where properties were overpriced will remain more, less, or equally balanced and cities like Pune and Chennai are likely to see price rises with concurrent infrastructure development.
Furthermore, increase in property prices is expected as many projects are in completion stage and demand for ready-to-move-in residential properties in top cities is rising. A robust appreciation in capital values in a short period is expected from affordable housing segments and the interim budget has encouraged builders and developers by introducing requisites for this segment that will boost the activity in 2014.
Indeed the year 2014 marks the rise in the real estate industry both on the commercial as well as Real estate sector.
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