Can Attractive Offers On Realty Boost Home Buying?
Bangalore: The real estate market in India is likely to revive in the second half of 2013 due to the improvement in the economic environment of the country. But, in this case, developers will have to offer pre-launch benefits and projects that include less add-on, so that developers can sell their project under affordable price bracket, said industry experts, reports Vidyalaxmi of Economic Times.
The experts said that the property prices in residential segment have gone beyond the affordability levels in cities like Mumbai. "However, this may not translate into drastic correction in real estate process because of higher cost of acquisition or even just holding the land for a project rises. Moreover, they are already beset with the increased costs of license costs and cost of construction," said Anuj Puri, Chairman & Country Head, Jones Lang LaSalle India.
To increase sales and to attract potential home buyers, developers have been trying different marketing strategies, from giving discounts to freebies. But, such strategies may fizzle out due to the consistent hike in property prices.
"Hence developers have to drastically trim the frills in projects to make them more marketable from a pricing point of view, and innovative payment schemes. This will ensure that the real estate business is financially viable even from a developer's perspective," added Puri.
The current year has faced many ups and downs due to the constant revisions in the country’s GDP over the last three quarters. "In 2013, this trend will prevail - though the quantum of revision will be lower. The country's economic environment will certainly improve in 2013, with a corresponding (though lagging) gain in momentum for real estate," according to Puri.
"The most tangible benefits of economic improvements on the Indian real estate space will be seen in second half of 2013." Moreover, the Reserve Bank of India (RBI) is reducing its cash reserve ratio to enhance the credit situation.
"Further easing of liquidity with the prime objective of reviving the GDP is expected in the first half of 2013. Base rates, which peaked in third quarter of 2012, are likely to start falling on the heels of monetary easing by the RBI," Puri added.