Home Buyers More Keen On Resale Market

Bangalore: Over the last few quarters’ home sales in new projects have dropped across the country; yet the drop has failed to affect the resale market which is actually flourishing, reports Ravi Teja Sharma of ET Bureau.

In today’s date, home buyers are keen on resale market. Even Banks and housing finance companies are witnessing a shift in market situation where potential home buyers prefer not to take any chance with delayed projects. According to Destimoney, a company which provides home loans, nearly 70 percent people who are applying for loans are investing either in ready homes or nearly-ready homes, compared to last year when 70 percent customers secured loans to buy new homes and only 30 percent invested in the resale market.

Sameer Jasuja, chief executive officer of property research and analytics firm PropEquity, stated that “Enormous delays in execution, liquidity crisis, high cost of borrowings and growing rentals are reasons why home buyers now want ready properties,” reports Economic Times.

To avoid delays, home buyers are now prefer to enter in projects at a later stage and are keen to pay a premium rather than to survive in uncertainty. According to PropEquity’s research, almost half of the 930,000 under-construction residential inventories in India have been delayed by 18 months, which are scheduled to be delivered between 2011 and 2013.

RV Verma, chairman and managing director of the National Housing Bank, cited that “Buyers are scared of an indefinite wait and are trying to mitigate risk. It is a good signal for the industry and will put pressure on developers to finish projects on time.” Verma further said that “Developers should look at it as a caution signal.”