Pune's property market is showing some positive signs ahead of the festive season. That much-anticipated price correction finally appears coming about.
And it is not the stern stand of the Reserve Bank of India (RBI) Governor or the suggestion of the National Housing Board CEO that has prompted developers to think rational in terms of their price point and profit margins. Rather the market forces are increasingly compelling them to offer substantial discounts to get rid of rising inventory and debt burden. As a result, there has been a price correction of five to eleven per cent across the Pune market.
Although, officially, CREDAI has been rhetoric with it’s oft repeated stand of rising input and higher borrowing costs. However, pragmatic developers are understanding the benefits of price correction. On the eve of the festive season, they are strategising their marketing initiatives that could lead to a substantive price cut without overtly positioning it as correction. They are also conscious of the fact that the days of symbolic freebies are over.
Rajesh Nagpal, a broker in the Pune market, admits that the developers are today offering anything between five and eleven per cent, with the condition that the brokerage will not exceed beyond two per cent and the rest of the discount would be passed on to homebuyers. Officially, no developer is ready to admit this prevailing market trend but those active in the property market are well aware of the reality.
While the developers call it discount and marketing strategy, the critics are calling it distress sale. But a price cut is definitely there in the market. Most importantly, homebuyers are smiling their way to the housing market that has addressed one of their major concerns. On the eve of the festive season, these raises a fundamental question as to whether there will be more price correction or it would be the usual festive offers of freebies to attract buyers.
Kishor Pate, CMD, Amit Enterprises Housing, agrees that during this year's festive season, Pune real estate would be very much a buyer's market and aspiring home buyers hold a clear advantage. This is an opportunity to zero in on the best of the available options, negotiate the best rates and make the dream of a self-owned home a reality.
“While overt price cuts may not be much in evidence, the various offers to reduce the financial burden on homebuyers are as good as hard discounts. Many developers are waiving off service tax and even stamp duty on their offerings, which results in significant savings to buyers,”says Pate.
Source - TOI
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