Sluggish housing sector hopes for a festive gift

INDORE: Facing a slump of almost 30% in sales in the past two years, the real estate sector in Indore is struggling to get into gear. Of the 60,000-odd apartments in the city, as many as 28,000 are lying unsold and vacant.

Industry experts pin their hopes on Diwali, believing that a decent growth is expected in the festive season.

CREDAI

(Confederation of real estate developers association of India) says that since the market will buoyed by the festival mood, home-buyers may begin to invest.

"The real estate sector of the city has been stagnant for the past two years. Indore is a major commercial hub of the state and has a continuous movement of capital. At this point of time, builders are expecting growth," said CREDAI Indore chapter's secretary

Akhilesh Kothari

.

A major chunk of apartments in the city have seen a dip in resale value. With more than 25,000 vacant apartments, real estate developers are finding it difficult to earn from the projects. "The current rate per square feet is almost the same as it was two years ago. This is one of the reasons why home-buyers are not finding it viable to sell their flats. There is no appreciation," added Kothari.

Experts claimed that close competition in similar types of apartments has dented the rates of already owned flats. Indore housing has been a market of affordable, luxury and ultra-luxury apartments.

"Today 70% buyers look for affordable housing and the rest are in for luxurious apartments. But the newer projects that are coming up are largely focusing on premium flats, which are not on the list of most home-buyers," said CREDAI's youth wing secretary Niket Mangal. Flats ranging from Rs 25 lakh to Rs 40 lakh come under the affordable housing criteria. Anything above that classifies as premium. But realtors seem eager to cash in on luxury. "The biggest gap is in demand and supply of housing. Affordable housing is what majority consumers need but there are increasing options in premium apartments. That is not what most buyers need," he added.


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