Homebuyers Advised To Focus On The Locality And Reputation Of The Developer

Kolkata, December 18: A commentary by real estate consultancy firm JLL reveals that in 2019, the first three quarters witnessed 14 per cent growth in residential unit sales, which was quite promising when compared with the first three quarters of 2018. Most cities have shown moderately good performance. However, the last quarter of this year didn’t keep up with the growth of the first three quarters. Hence, the year is expected to end at similar levels of 2018. The economic condition, mainly the GDP growth has had a negative bearing on the buyers’ sentiment.

This said, investments in the residential segment are making a slow comeback in the form of long-term capital commitments with reputed developers at the entity level. This proves long-term optimism in the sector. The residential segment is sentiment-driven and with the economic sentiment coming back or the economic GDP growth rate falling in place, the implementation of RERA will be done effectively in most of the states.

Affordable housing is still the favourite of masses and the demand is high for this segment. As a result, the segment has been moving on at a steady pace. Luxury and premium markets are yet to come back.

There won’t be much of traction in the primary residential market and it will take another year to see the residential sector registering substantial growth. Till then the growth will be hovering around with a modest rate or maybe just clocking the run rate of 2018.

“The home prices will remain stable. We expect it to remain range bound and we do not expect more than three-five per cent annual appreciation which is just in tandem with the retail inflation rate. The developers won’t want to increase the prices, what they want is to bring back the sales volume. In most of the big cities such as Delhi NCR and Mumbai the volumes have come down by 40-50 per cent from the last peak of 2010-11,” says Samantak Das, Chief Economist and Executive Director- Research & REIS, JLL.

He adds that buyers are preferring ready-to-move-in projects. “However buyers also keen on projects which have been launched recently and under construction, but in good localities and in which construction is done by reputed developers. The developer and location selection is equally important. But there is bias towards ready-to-move-in projects.’

Das advises that one could go to the RERA website to know the legal aspect of the projects of various developers and if the developer is a listed developer, it is easier to have view about their financial conditions. A buyer should thus do proper due diligence before zeroing down on a property.

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Homebuyers Advised To Focus On The Locality And Reputation Of The Developer

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