The long standing stalemate in the residential sector has made a heavy dent in new residential projects this year with 65 per cent less projects being launched this year as compared to last year.
According to data released by property consultants Knight Frank, in 2011 only 19,470 residential units were launched in Mumbai as against 54,968 units in the previous year. The report states that the dwindling launches clearly point towards “the lack of buyer interest in the extremely expensive Mumbai property market” and the fact that builders “remained in a denial mode with respect to lowering the prices”. Also, the unsold inventory in Mumbai is high at 32 per cent (i.e. 40,660 housing units).
In addition to the handful of new launches and slack transaction, the year has also been witness to stubbornly high property prices. According to Pranab Datta, vice-chairman and managing director, Knight Frank India, the deadlock between the buyers and developers should break in favour of buyers. “As this happens, the pent up demand from the section of buyers that are sitting on fence in anticipation of price correction would translate into improved fortunes for residential property market,” he said. He added that employment scenario, inflation and interest rate will also have a bearing on the overall sentiment of buyers. Across seven cities in the country including Mumbai, NCR, Bangalore, Hyderabad, Pune, Kolkatta and Chennai, the residential segment saw a decline of 52 per cent in new launches as compared to last year.
Source: http://www.indianexpress.com/news/buyerbuilder-deadlock-results-in-65-less-houses/892931/
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