Mumbai realty determined to bounce back this Diwali-II

By: Ravi Sinha

Track2Realty Exclusive: Many believe the current level of housing inventory is limited and hence many of the companies are launching their projects in phases. The current spate of launches in Mumbai has opened up an inventory of 5,000 plus premium residential apartments aggregating Rs 7,200 crore at market average of Rs 12,000 per sq ft. A majority of the inventory on offer is for the premium residential segment.

Says Kamal Khetan, CMD, Sunteck Realty, “We have launched Phase-1 of the entire project located strategically at Goregaon West which is a lifestyle city within the city.”

Lodha Group has also made a soft launch of its Tower 3 at Wadala and “Evoq” at Parel; Sunteck with its tie-up with Disney has launched Sunteck City in Goregaon west. Runwal has launched its ‘Anithorium’ in Central suburb; Godrej has launched 2 projects -Godrej “Serenity” in Chembur and one in Byculla and is set launch the Tower 3 of Godrej Platinum in Vikhroli East.

This raises the fundamental question as to whether the demand has also been fairly even with the supply dynamics. Some sector analysts are bullish that if the project is well positioned and the credibility of the developer is good, there is always a demand. One of the brokers in Mumbai, who didn’t wish to be quoted, cites the example of record 400 confirmed bookings last month in Mumbai with the L&T- Omkar joint venture for its yet-to-be-named premium residential project in Bhoiwada, Parel area in central Mumbai; which is yet to be launched in the market.

Developers also seem to have learnt their lessons out of the turbulent couple of years and new innovative marketing formats are being tried and tested. While a select few developers have straightaway cut down on the prices to attract buyers, others like Nirmal Lifestyle are offering free stamp duty and some are even doling out silver coins and cars.

Those with the proven timely execution capabilities are experimenting with the 20:80 scheme to beat the slowdown and invoke confidence in the psyche of the buyers. The scheme, also known as the ‘subvention scheme’, is emerging as a popular marketing tool, as the buyer has to pay only 20 per cent upfront, while the remaining 80 per cent is paid at the time of possession.

Manoj John, VP, Corporate Planning & Strategy, RNA Corp says there are several factors that will have a combined effect in the recovery of realty market, rather than just change in the marketing strategy. Even the existing projects that would have undergone redesign & resubmissions as per the new DCR would see a revival in marketing campaigns.

“There is an emerging trend towards reworking the area formats to enhance the carpet areas, and adopting smaller areas for the conventional 1BHK, 2BHK apartments. These are measures to lower the overall ticket size, and make it a more affordable proposition. In the luxury formats, there is emergence of two trends – Branded Residences & Serviced Residences.

The Branded Residences offer designer homes as per the style standards of international luxury brands; the extent of design play could include furnishings and fixtures in the house. Serviced Residences will be customized offering that include various services as add-on package like concierge, butlers, housekeeping, gourmet kitchen etc,” says John.

While many developers assert that buyers’ enquiries have increased, a Track2Realty Study in the Mumbai market prior to Navratra seem to agree with this. As per the study, nearly eight out of ten, as many as 76 per cent, prospective first-time home buyers have realised that the patience game is not going to offer them cheaper homes. Instead of waiting for the price crash, a wishful thinking as a developer points out, they are on a house hunt with best value proposition. And that is something which is making the Mumbai realty optimistic about the change of fortunes and market dynamics this festive season.