Residential sales bookings have seen a 10-15% drop in the run-up to Diwali due to higher prices and lack of new launches in cities such as Mumbai, Hyderabad and others.
At the beginning of the festive period, developers were expecting around 20-40% jump in festive sales. Now, sales growth in the festive season is expected to be between 8% and 10% in the top cities.
“Current trends suggest that there is anywhere around 10-15% decline in sales compared to last year’s same festive period,” said Santosh Kumar, vice-chairman at Anarock Property Consultants.
Kumar said the decline is largely because property prices have escalated significantly over the past one year across the top 7 cities, and “it is becoming unaffordable for many to buy a property today”.
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Residential prices have gone up 20-30% in the top cities in the last one year.
Housing sales in the top seven cities in the third quarter of CY2024 dropped 11% on a yearly basis to 107,000, owing to factors such as high prices and monsoon, Anarock said recently in a report.
Property developers such as Dhaval Ajmera, director at Ajmera Realty & Infra, said sustenance sales (sales from existing projects) are happening but not many new launches have happened due to the elections in Maharashtra and National Green Tribunal (NGT) orders, which have delayed approvals.
Bookings in Q2 were hit due to delay in clearances and subsequent decline in launches, said Amit Bagri, chief executive, Kotak Mahindra Investments, which provides loans to developers. Bagri expects a growth of 8-10% in sales bookings in the festive season. “We expect approvals to come in Q3 and Q4. After two years of high growth, 8-10% growth is not bad,” Bagri said. However, he added that big listed developers are meeting their guidance.
Sameer Jasuja, founder and CEO of PropEquity, said the numbers will not beat last year’s Diwali because 2023 had witnessed historic high sales and launches. “The first three quarters of 2024 have demonstrated lower absorption and launches across major Indian cities,” he said.
A managing director of a national real estate company agreed with Bagri. “People have forgotten sales have run fast in the last four years.
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