Decline in Home Sales as Property Prices Go Up

Bangalore: With the increase in property prices and home loan interest rates, sales in residential units witness a drop. But, even with the drop in home sales, property prices in National Capital Region (NCR) and Mumbai Metropolitan Region (MMR) have seen a sharp rise this year. Whereas, sales in residential units in Bangalore remains stable and experienced only around 3 percent drop in home sales.

During January-August 2012, sales of residential units in Delhi-NCR witnessed a slump of 42 percent compared to last year same period. On the contrary, this year the average property prices shot upto 14 percent to 3797 per square feet, according to PropEquity, a real estate consultancy firm, reports Prabhakar Sinha of TNN.

Market observers said that Gurgaon has reached its maximum limit in terms of land availability and so, developers are moving towards outskirts to launch their new residential projects, due to which developers are facing hard times selling their units. Besides, Gurgaon has witnessed a hike in property prices which has doubled over the past few years.

In Mumbai Metropolitan Region (MMR), residential unit sales dropped by 34 percent while the average price has increased by 4.1 percent to almost 6354 per square feet this year, said the report. For example, in Mumbai Metropolitan Region (MMR), an average price of a two bedroom apartment will be around 1 crore, which is far beyond the budget for a large section of people.