Tough Time for Bangalore Realtors

February 3, 2009	(Be the first to rate this story!)  Loading ...
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Real estate developers in Bangalore are facing a queer situation. On the one hand they are trying to lure new customers with attractive baits like offering cars free with new flats to boost the sales and on the other hand, they find it difficult to sell already booked flats to customers who want them on the current prices which have fallen due to economic meltdown. The builders say that there is a demand for residential flats but prevailing high interest rates on housing loans is keeping it subdued.

“Although we have been affected because of the international scenario, the demand for residential units was there and it continues to be there. Because the interest rates on housing loans were very high, the demand did not surface. It is like a pent up demand, demand is there but it is not able to come out because of the cost of funds on housing loans,” said Bala Krishna Hegde, Ex-President, Confederation of Real Estate Developers Association of India (CREDAI).

According to Hegde, the builders allude the fall in demand for residential units in the city to the global recession having very adversely affected the U.S.A and many other developed economies. The IT hub Bangaluru is also facing an uncertainty due to the recession as it mostly carries out business outsourced from the US and the UK. The financial institutions reluctance to advance housing loans in the current scenario has largely led to a fall in demand in the real estate sector in the city.

And those who have already purchased their flats but are yet to make final payments want these now on the current lower prices to the great discomfituref the builders. “I have got lots of friends and their families who have invested in many of the apartments. We expect them (builders) to do is to slash their prices to the current price in the market today so that we become able to pick up the flats immediately, “said Praveen Kumar, a buyer.

According to the experts from Chambers of Commerce and Industry (CCI) ofarnataka who have kept an eye on this changing situation, the bubble of a bigpurt in salaries of IT professionals and others has burst and there are salary cuts being implemented or contemplated by many companies that has madeanks jittery about advancing housing loans. Bur real estate developers are hopeful of better times to come as banks are under pressure to slash interest rates to spurt demand to tide over the ongoing economic slowdown in the country.

News Published Under:   Bangalore |

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