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Property Price Trends and Forecast for Key Metro Cities, in 2017

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Property Price Trends and Forecast for Key Metro Cities, in 2017.

Several factors have impacted the real estate market in the country in the past one year. We examine how these will affect property prices in some of the key metropolitan regions, in 2017

Realty prices in the country, have been impacted by various factors over the past year, such as the GST bill, RERA, demonetization and the support to affordable housing. Experts point out that property prices were largely stable before November 2016 and subsequently, there has been a correction of 2-5% in the secondary market. While developers have resisted price cuts, they continue to offer attractive payment plans.

The implementation of the Real Estate Regulation Act (RERA) and consumer activism against project delays, have pushed developers to focus on completion of existing projects. Institutional investors too maintained a strong interest in financing Grade A residential projects under-construction, in 2016, helping developers to complete their existing projects.

“Implementation of the RERA and GST, a lower home loan interest rate regime and fiscal benefits for tax payers in the Union Budget, will infuse a ‘feel good factor’, which is extremely important for the revival of the industry. The prime minister has already announced a gift to home buyers in the budget segment (both, in rural and urban areas), in the form of interest subvention for home loans,” says Shishir Baijal, chairman and managing director, Knight Frank (India) Pvt Ltd.

According to Surabhi Arora, senior associate director, research, at Colliers International India, the price trends in the top metro cities, have been as follows:

Mumbai and its peripheral areas: The Mumbai residential market started 2016 on a promising note but was adversely impacted by the demonetisation drive.

The gap between buyers’ and sellers’ expectations have widened.

Market activity is likely to remain slow but the second half of the year could be more active, as the gap between buyers’ and sellers’ expectations narrows again on account of realistic pricing.

Pune: Localities adjacent to the commercial hubs of Pune in the west (Baner, Hinjewadi), south (Undri, Handewadi), south-east (Keshavnagar, Hadapsar) and east (Kharadi), were most active throughout 2016. Despite being one of the most active residential markets in 2016, the market in Pune slowed down towards the end of the year.

Residential sales will pick up in 2017 and reputed developers may launch more affordable projects.

Delhi-NCR: New launches will remain limited in both, Noida and Gurgaon.

Contrary to general perception of a significant price correction, there is anticipation that prices will largely remain stable. However, a more noticeable correction of 5%-7% in emerging micro-markets such as Noida Extension, Sector 70 to 78 in Noida, Dwarka Expressway and Golf Course Extension Road looks probable, due to the high inventory available in the secondary market.

Kolkata: The market is almost stagnant and likely to remain so. However, we may see traction in affordable and mid-segment projects.

Bengaluru: Mid-segment projects with realistic pricing, are likely to remain afloat in both, the primary and the secondary markets.

Developers will probably resist cutting prices but continue to offer subsidised payment plans and price guarantees. Prospective buyers should not delay their decision unduly, as they can negotiate realistic prices in both markets.

Chennai: Chennai’s residential market remained subdued in terms of new launches, as well as sales, as buyers’ sentiments remained weak due to a series of events in 2016. However, with cheaper home loan interest rates and increased developer focus on completion of projects, buyers’ confidence should perk up.”

Property price trend and forecast for metro cities

Metro city Price range (Rs per sq ft) (As on March 2017) Change in price per sq ft (-/+) in the last one year Change % (YoY (-/+)) / Forecast for next one year
Mumbai
South Mumbai 45,000 – 66,000 -5% Overall stable in the secondary market. Deal-based discounts will be available in both, the primary and secondary markets.
Mumbai suburbs 20,000 – 40,000 -3%
Mumbai peripheral 7,000 – 20,000 -1%
Pune (city level) 4,200 – 16,000 -4% Overall stable in the secondary market. Deal-based discounts will be available in both, the primary and secondary markets.
Delhi-NCR
Gurgaon 6,000 – 36,000 -2% Overall stable in the secondary market. Deal-based discounts will be available in both, the primary and secondary markets.
Noida 4,300 – 11,500 -2% Overall stable in the secondary market. Deal-based discounts will be available in both, the primary and secondary markets.
Kolkata (city level) 2,500 – 10,000 0% Stable
Bengaluru
Central 19,000 – 27,000 -5% Stable in localities near commercial hubs. Central and peripheral locations may see 2% to 5% correction.
Central suburbs 7,000 – 14,000 -1% to -5%
Southern peripheral 4,500 – 8,500 2%
Northern peripheral 4,000 – 8,000 -2% to -4%
Hyderabad
Central 8,000 – 15,000 5% Stable
Central suburbs 4,000 – 6,900 0% -2% to -5%
Western peripheral 3,500 – 6,500 0% Stable
Chennai
Central 20,000 – 35,000 -1% Stable
Off-central 13,000 – 25,000 -2% 1% to 3%
Western suburbs 14,000 – 18,000 5% Stable
Southern suburbs 13,000 – 17,000 2% to 4% Stable
Kochi
Eastern peripheral 3,500 – 7,500 -5% Stable
Far northern peripheral 3,300 –  5,000 0% Stable
Jaipur (city level) 3,000 – 10,200 -1% Stable

Data provided by Colliers International India     

Source: Housing.com

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Magicbricks Ads Singing And Dancing To Housing

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Magicbricks Ads Singing And Dancing To Housing

Magicbricks, the online real estate portal, launched India’s first musical real estate commercial. The platform offers over 14 lakh listed properties. With the dancing and the song ‘Property Ka Supermarket’ they hope to offer a shot of positivity.

The ad is about a young couple who are looking for their perfect home while sitting on their couch. Once the app fires up the couple is transported to a supermarket, where shelves are stocked with all sorts of homes. The song in the background goes like “One, two, three, four, saare BHK. Bungalow, villa, flats hatke. Ready-to-move-in any time, Possession mein ya hai time. Oonchi price, neechi price, sasta-sundar-sabse right.” It has also got a catchy tune for anyone to voluntarily start humming it.

The idea behind the ad was to communicate all that Magicbricks, a Times Group company, has to offer at every stage of the buyer’s expedition. Right from their range of properties to home-search related services like experts backing and buyer reviews.

Prasun Kumar, Magicbricks marketing head, points out, “There was genuine consumer interest that came back in the industry, believing that there’s a clean-up act happening and as a buyer, you’ll probably get better value for money now. However, due of multiple policy interventions, interest was not converting to deals.”

This obviously left the builders in anguish. According to the experts, consumers were desperately seeking reassurance. He added, “With this backdrop, we realized this festive season would be a window of opportunity to go to consumers with a different narrative. We realized the external factors are not conducive to a very emotional, melodramatic approach. We needed a mood refresher.” Thus the answer was Bollywood song and dance. Thus, stressing on the point of quality, trust, choice and best deals.

Another myth that it bursts is that buying a home is a man’s job. Kumar said, “The image is that real estate is a masculine category. This is also part of the challenge because all of a sudden 50% of your TG is out of your purview.” However, the fact remains that it is a joint decision of both man and woman.”

Nevertheless, not everyone seems convinced with the ‘property ka supermarket’ idea. Karthik Srinivasan, national lead, Social@Ogilvy points out that supermarket is generally where you get a lot of cheap things. Moreover, he isn’t very happy with the execution, as according to him it doesn’t do justice to the idea well enough. He adds, “I read the material that was released with the ad (Every agency does this.) It went ‘property ka supermarket’, first musical real estate ad, etc. It’s a tall claim. There is an interesting germ of an idea that is the property market is gloomy because of RERA and everything, and they wanted to make it light, musical, positive and buoyant. But the execution wasn’t as interesting as the idea itself.”

He concluded by saying, “What remains to be seen is if the houses do the real estate equivalent of flying off the shelves.”

Also Read: INIT Mumbai Wins The Prestigious Realty Plus Excellence Awards 2017

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Tanvi Group Fail To Deliver Homes And Declare Bankruptcy

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Tanvi Group Fail To Deliver Homes And Declare Bankruptcy

Another case of delay in project completion and possession has surfaced, once again escalating investment fears for home buyers. Tanvi Group is under scrutiny at present. The group has declared bankruptcy.

They have taken 1000 crore as 50 percent advance for almost 500 flats in their Dahisar project. They have now filed for insolvency and all their project construction have stopped leaving the buyers in a lurch.

Almost 200 families have invested in their Kashimira project – Tanvi Eminence. The project started in 2010 with possession committed in 2013 however even after 7 years the construction remains incomplete and no sign of possession. More than 100 home buyers gathered at Kashimira in Mumbai to protest against the delay in completion of their housing project.

Tanvi Group is also accused of building 20 floors at Tanvi Eminence while they only have the permission to build 11 floors. Buyers have also registered a complaint at the Kashimira police station. According to sources, there are four partners namely Vijay Kumar Hegde, Sangeeta Hegde, Bhupat Lukhi, Dayabhai Sutaria in this project but due to their internal disputes, the projects have been left hanging.

A disgruntled buyer said, “Last seven years we all have been waiting for our houses. We have invested our hard earned money here. All we ever get is new promises and new dates of delivery. Due to builder’s internal conflict, they are playing with our emotions and money and this has been happening for the past 7 years. We even tried to cooperate with them but now all we want is our houses.”

One of the partners at Tanvi Eminence, Dayabhai Sutaria said, “I have filed lawsuits against my two partners Bhupat Lukhi and Vijay Kumar, for not cooperating with me and taking this project forward. My sentiments are there for the home buyers who have invested their money.”

While Vijay Kumar, Partner at Tanvi Eminence said, “Mr. Dayabhai is holding payment of more than 20 crores and Bhupat approximately 7 crore which is sufficient to buy the TDR and start construction. They are misleading all the buyers.”

There is no doubt that MahaRERA Act is tightening the noose around the developer community. However, according to legal experts, some of them may have found liquidation proceedings or the bankruptcy law as an avenue to escape the ambit of the state regulator.

Experts have predicted incidences of insolvency to go up going forward as builders may be able to transfer the losses to property owners.

As for the home buyers, it is in their best interest to check if the project they want to invest in is RERA compliant and all permissions are in place. Instead of delaying your decision to buy a property, it is better to make informed decisions to stay above any traps.

Also Read: 50% Growth For Nashik Realty Sector Since Ganeshotsav

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Insomniacs Bags The Digital Marketing Campaign Of The Year At The Realty Plus Excellence Awards 2017

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Insomniacs bags the Social Media Campaign of the Year at the Realty Plus Excellence Awards 2017

It is a big moment for the Mumbai-based digital media agency Insomniacs. They won the prestigious Realty Plus Excellence Award for the Raunak Group’s ‘Darr Ke Agae Ghar Hai’ campaign.

Raunak Group, an established realty brand in Mumbai, was going through the aftermath of the demonetization. They recognized the problem as clarity – consumers had no clarity and nor did they have a trusted source that they could turn to. The developers were sitting with folded hands waiting for buyers to knock their doors while the unsold inventory had become a huge cause of worry.

This is when team Insomniacs believed was the opportune moment to send out a strong message. Pranav Patadia, director, said “When an opportunity knocks at your door, you need to recognize it and make the most of it. We were given a challenge and we wanted to tackle it in a unique way; in the process offering a solution which has never been attempted before. The result of that effort is in front of us.”

The idea was to emerge out of the rumours and make people believe in the offers instead of just rotating advertisements in the market. When the market hit rock bottom, getting people to visit the project sites was a herculean task in itself. Thus the “Darr Ke Aage Ghar Hai” campaign was created.

The campaign was supposed to bring to light the many fears that home-buyers face today. “Darr Ke Aage Ghar Hai” engaged the masses on social media and dispel these fears, systematically and ultimately. One of the major fear-inducing problems the customers faced during demonetization was the prolonged delay in possession. Raunak Group with the team’s assistance aimed to successfully resolving this and many other issues.

Shyamal Mody, Marketing Director Raunak Group stated, “I congratulate the team for the award and the campaign that they introduced. It is a pleasure to work with such a dedicated team. Raunak Group sold inventory worth 50 crore for 1.23% marketing cost. The best part was that people could actually find solutions to their property problems and most of them ended by up a house for themselves.”

There was a lengthy ground research involved along with an impactful campaign on social media channels and on-ground activities. Even a micro site was created ‘A2Z of Darr’ which highlighted various home buying fears of a customer, providing detailed solutions for each and every problem.

The team managed a highly successful campaign with highest ever sales recorded by any real estate group. Govind Rai, Director, Insomniacs added, “The idea was to create a campaign for a larger impact. We were fully aware how the campaign could be advantageous on other media platforms. The fact that other ad agencies carried out our campaign talks lengths about its success.

It was indeed a well-deserved win. We congratulate the team at Insomniacs.

Also Read: Realty NXT Does a Survey On Why People Feel Scared to Buy Homes

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