Lower booking amount helped Developers to sell New Properties

April 27, 2009	(Be the first to rate this story!)  Loading ...
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Falling real estate prices coupled with lower booking amounts are helping developers sell new properties in cities such as Mumbai and Chennai.

A recent report said that there has been a correction of as much as 30% in prices of projects that have just been announced.

“While there has definitely been a correction in prices, it is patchy and not yet complete in many cases. Most correction is around the 10-15% mark with some projects having corrected by almost 30%. A large amount of correction seems to have taken place in and around Mumbai in areas such as Thane, Mulund, Virar and Mira Road,” the report said.

Over the past one month or so, several developers launched new projects at lower prices that were adjacent to their ongoing projects. Often, they have lowered prices in their existing projects to woo prospective buyers. “While there is no mad rush to buy homes at the right price, deals will happen. Both buyers and builders have realised that,” said Akshaya Kumar, MD, Parklane Advisors, a real estate consulting firm.

A case in point is that of Nirmal Lifestyle. The company launched new projects in Mulund and Kalyan at special prices and now claims to have sold over 700 flats. “While the price in November was Rs 7,000 per square foot, the flats in the new project in Mulund are being offered at Rs 4,800 per square foot,” said Nirmal’s MD, Dharmesh Jain.

Several other developers like Akruti in Mira Road has sold 300 flats within days of its launch. HDIL, another builder, has offered properties in Mumbai’s suburbs, such as Andheri and Kurla, for which the response is said to be good.

Chennai, too, has seen a correction in prices with several builders dropping prices by 10-30%. “Some genuine builders are ready to pass on the cost benefit to people, who booked earlier. This could be in the form of more area for the same price or just more freebies,” said a property dealer in Chennai.

A leading builder in the city is offering a discount of Rs 200 per square foot, if the payment is made upfront. This gives a good opportunity to cash-rich investors.

In Mumbai, Neptune Builders for its Bhandup project, has asked for a booking amount of just Rs 51,000 for a two bedroom apartment. Since most buildings take about 2-3 years for completion, the balance payment can be staggered.

“Definitely, when compared to the first three months, there is larger number of transactions taking place, though the exact situation will only be known in a couple of months when the next installment needs to be paid,” said a senior official at a real estate mutual fund.

News Published Under:   Real Estate India, Real Estate Developers, Property Prices |

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