The Indian housing market is a vicious cycle of broken promises, trust deficit, sulking participants and non-delivery. Statistics only tell you half the story. For the developers, market trackers and the government agencies it is all about numbers – how many units have not been delivered. What these raw statistics don’t tell you that there is a sordid saga of drying emotions of one family with each housing unit. Probably the stakeholders are least bothered about the plight of an average middle class home buyer who has exhausted his lifetime savings, taken up home loan and now reeling under the burden of both the EMI and the rent.
Browsing: Myth & Reality
While consolidation has been an ongoing phenomenon for some time, recent mergers, acquisitions and joint developments are underscoring this trend like never before. The Indian residential sector saw a series of disruptions in the last two to three years, with revolutionary reforms like DeMo, RERA and GST remarkably altering the way real estate business is conducted. A natural by-product of this upheaval was consolidation, with fly-by-night developers completely vanishing and small players merging with big ones.
This home buyers’ outburst over the media hype & industry reaction with reference to reduced GST is not an exception. Across the country the home buyers are questioning how the GST reduction has made the houses affordable in the cities where the jobless growth is fast turning into job loss de-growth. This is over and above the fact that the property prices are way beyond the affordability index.
Track2Realty approached to a number of real estate developers who are offering assured returns. Though all of them refused to speak ‘on record’ but privately they admit that their assured returns have failed due to market dynamics than intentional cheating.
Such misleading claims prima facie give an impression that the property market in the Indian cities in general, and Delhi-NCR in particular, have peaked up on the eve of long festive season ahead. The claims nevertheless raise more questions than could answer as to how and why there has been sudden spurt in the sales velocity.
This is probably one of the wishful thoughts of the developers that have been over projected round the year (NRI investment being the other). But a ground zero study of the property market across the key cities indicate that the online property portals offering real estate deals may have made inroads like never before, this definitely is not the end of traditional brokerage or substitute of traditional format of selling through taking clients to see it and believe it.
Gone are the days when the overnight appreciation of property prices was enough for the fly by night operators to lure the buyers with glossy advertisements. The ROI of the advertising spend by the developers was calculated with the number of phone calls in return. The economic downturn leading to an end of era of quick appreciation, however, changed the market dynamics completely.
Excuses galore within the sector and there is a big question mark over the execution and delivery capability of the developers. The execution failures have given a lending credence to the criticism that the developers just can not deliver on time. Delivery has emerged as a major issue even though the developers continue to blame it on external factors.
It is generally accepted in the Indian market that rental yields in the country are often much lower than elsewhere in the world because relatively few people seek rented homes: 66 per cent of homes in Indian cities and 90 per cent of homes in rural areas are owner occupied.
CSR means different things to different stakeholders of India Inc. and today there is no reliable rating/valuation methodology to measure CSR standards. Most of the ranking that has been done about the most sustainable corporations is not professionally standardized or uniform.